HCM City’s collective economic model achieves good results

Ho Chi Minh City has achieved positive results in the implementation of its collective economic model, with an increase in the number of cooperatives and their quality, according to the municipal People’s Committee.

Cooperatives display their products on the sidelines of a meeting held in HCM City on September 24 to review 15 years of implementation of the Party Central Committee’s resolution on continuing to reform, develop and improve the collective economy.

Speaking at a meeting on September 24 to review 15 years of implementing the Party Central Committee’s resolution on continuing to reform, develop and improve the effectiveness of the collective economy, Le Thanh Liem, Vice Chairman of the municipal People’s Committee, said the numbers of cooperative groups, cooperatives and unions of cooperatives have increased significantly over the past years to reach 2,097; 612; and 6 by the end of last year.

They operate in various sectors, including services and trading, transportation, environmental hygiene, agriculture, industry, craft, and credit, he said.

Over the last 15 years the city's collective economy has asserted its key role in socio-economic development, he said.

“The number of cooperatives and unions of co-operatives with working capital in the hundreds of billions and thousands of billions is rising. Many have expanded across the country and export their products to many markets.”

However, there are still limitations in developing the collective economy, he said.

Most cooperatives are small with limited funds, lack business strategies, have poor management compared with other economic sectors, and are disadvantaged in the integrating economy, he said.

In the next decade the city would focus on developing the new-style cooperative model, he said.

In 2021-2030, HCM City targets the setting up of 300 cooperatives and five unions of co-operatives, he said.

The sector is expected to achieve annual growth of 7 percent, account for 0.6 percent of the city’s economy, and create 30,000 jobs each year, he said.

To achieve these targets, the city will implement a number of measures such as increasing the capital of the City Cooperative Member Support Fund to 2 trillion VND (86 million USD) by 2030.

It will continue to connect credit organisations and cooperatives, provide training to cooperative managers and help promote their products and improve their technologies.

Nguyen Thien Nhan, Secretary of the HCM City Party Committee, said land and capital are two difficulties faced by cooperatives for a long time. These have not been resolved satisfactorily, making it hard for the collective economy to achieve a development breakthrough.

Therefore, departments and sectors need to advise the People's Committee and the Department of Planning and Investment to make five-year plans for collective economic development in each sector, including agriculture, transportation, environmental hygiene, credit funds, housing and others.

They should come up with solutions for difficulties faced by cooperatives related to the use of agricultural land and borrowing from banks for production, buying machinery and building facilities, he said.