As both employers and employees suffer under the global health crisis, issuing new bailout packages is considered an urgent requirement to not only support their operations and livelihoods but also spur economic growth in the long run.
|The MoLISA thrashes out latest labour bailout proposals. Illustration photo |
The Ministry of Labour, Invalids and Social Affairs (MoLISA) is collecting opinions from ministries and relevant authorities to finalise a draft resolution on supporting policies for employees, employers, and businesses facing difficulties due to the pandemic. In the framework of the draft resolution, the MoLISA proposed to issue another bailout package worth VND27 trillion ($1.17 billion).
The proposal is being built as up to 9.1 million workers were affected by the pandemic in the first quarter of 2021, in which, more than 500,000 lost their jobs and over 2.8 million people had to take unpaid leave. When the pandemic at the end of April spread to industrial zones, it directly affected production and export as well as the livelihoods of hundreds of thousands of workers, according to the General Statistics Office. Industries such as passenger transport, aviation, tourism, and hospitality continue to be the most strongly affected.
Along with the proposal of the MoLISA, on June 6, in the framework of the seminar organised by the Economic Committee of the National Assembly to review the socioeconomic situation in the first half of the year and forecast for the second, Vu Hong Thanh, Chairman of the committee, asked experts to evaluate supporting policies and mechanisms for businesses and people affected.
Dau Anh Tuan, director general of the Legal Department at the Vietnam Chamber of Commerce and Industry, said that it had published its assessment results on the impact of COVID-19 on businesses in April.
The survey was conducted with 12,000 businesses in 63 cities and provinces from the end of 2020 to the beginning of 2021. The results showed that the pandemic caused an extreme impact on domestic businesses, with 87.2 per cent of those surveyed saying that the crisis had a negative or very negative impact on their business activities.
About 65 per cent of private enterprises and 62 per cent of foreign-invested enterprises (FIEs) saw a decrease in revenue in 2020 with an average decrease of 36 per cent at private enterprises and 34 per cent at FIEs, compared to 2019.
Tuan explained that traditionally strong sectors of Vietnam such as textiles and garments, and leather and footwear had to deal with supply disruptions and changed consumption behaviour of the target market. Service industries, such as tourism, have been particularly hard hit.
As requested by the government, the Ministry of Planning and Investment (MPI) is continuing to formulate new policies and solutions to assist people and businesses vulnerable to COVID-19, which are expected to help people and businesses capitalise on possible opportunities to recover from their difficulties, helping the economy grow further.
The MPI is now also building a governmental resolution on supporting and developing businesses for the 2021-2025 period.
The MoLISA is also reviewing implementation of the VND62 trillion ($2.69 billion) package launched one year ago to support 20 million poor and unemployed people.
The package comprised of a VND16 trillion ($695 million) sum aimed at providing loans to businesses at a zero rate to help them pay salaries for employees. However, it is reported that so far only VND14 trillion ($608 million) or 22 per cent of this package have been disbursed due to numerous impediments.
Since the second quarter of 2020, the government has also been deploying some drastic measures to support businesses. For example, the State Bank of Vietnam is deploying a package worth VND180 trillion ($7.82 billion) for businesses and households with debt payment deferral and preferential loans. However, no concrete reports on the disbursed amount have been revealed so far.