Enterprises using loans have greatly helped the non-State economic sector become the largest contributor to the city, accounting for 45 percent of total GDP. Notably, the sector has markedly contributed to job creation and social stability and increased the flexibility of the national economy.

During the current international integration process, most enterprises claim that Vietnam’s entry to the World Trade Organisation (WTO) will help diversify input-material markets, reduce prices and expand output markets.

However, a disadvantage is the expected flood of imported cheap goods into the domestic market. The lower quality of some Vietnamese products compared to their foreign counterparts and enterprises’ poor competitive capacity are other negative factors. Therefore, it is imperative for enterprises using loans to increase their business capacity and competitive ability.

According to the HCM City Business Association, enterprises in the city should intensify investment in equipment and facilities while applying advanced technology in production. This can be demonstrated by the fact that if enterprise managers know how to make the most of consultants, the importing of equipment will be improved.

For the domestic market, enterprises using loans must re-organise their retail agents across the country, and conduct market surveys to provide products matching customers’ taste. For exports, they should concentrate on their main markets, comprising the US, Japan and EU, as well as new markets such as ASEAN members, China and the Middle East.

However, due to small-scale production, most enterprises using loans are facing a lot of difficulties in capital, technology, human resources, and market information.

Ho Chi Minh City authorities, therefore, have been proposing many measures to assist such enterprises to solve their problems. The city has set up a credit fund with a charter capital of VND50 billion to provide help for enterprises using loans from the State budget.

The fund will receive capital from the State budget, sponsor aid from organisations and individuals, and even official development assistance (ODA) capital to assist enterprises.

The city has also asked credit organisations to support enterprises with access to medium-term and long-term loans, provide loans to promote and protect trademarks and train managing officials, thereby aiming to help enterprises using loans sharpen their competitiveness in the lead up to Vietnam’s entry into the WTO.