Vietnam’s New Rules Lead to Record High of Business Formations

The application of new laws has helped boost the number of business formations in Vietnam to the all-time high of 110,100 this year.


                    A street vendor at the Old Quarter on Hanoi. Photo: The Strait Times.

As many as 110,100 businesses have entered the market in Vietnam in the year to December 20, rising 16.2% from a year earlier and marking a record high, according to the Ministry of Planning and Investment.

            Source: Business Registration Department, Ministry of Planning and Investment.

Their registered capital has reached a combined 891 trillion dong ($39.2 billion), soaring 48.1% year-on-year. However, the newly-established firms created 1.27 million jobs, down 13.9% year-on-year.
In addition, nearly 26,700 enterprises have resumed operations, up 43.1% year-on-year.

These figures indicate not only the growth of the Vietnamese corporate sector in recent years, but also improvements in the local business environment and thriving opportunities, said Deputy Minister of Planning and Investment.

The real estate sector has seen the sharpest increase in new business formations, at 83.9% to reach 3,126, indicating the property market has been back to the growth track since 2015.

Ho Chi Minh City and Hanoi remain the largest homes to new market entries, with 36,442 and 22,663, respectively. The new firms in the two metropolis account for 53.7% of the total in the country.

The number of new business formations has been on the rise in Vietnam after the amended Laws on Enterprises and Investment took effect in mid-2015.

The implementation of the Law on Enterprises has helped cut the approval time for business registration to just 2.9 days while the average time for registration adjustments has been reduced to 2.05 days.

Tuan Minh / BizLIVE