Nearly 35,000 businesses cease operations in Q1

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Almost 35,000 enterprises withdrew from the market in the first quarter of this year due to the ongoing COVID-19 pandemic, according a survey conducted by the Vietnam Chamber of Commerce and Industry (VCCI).

This is the highest number of withdrawals ever recorded and the first time the number has exceeded the number of newly-established enterprises, VCCI said.

VCCI Chairman Vu Tien Loc said nearly 80 percent of respondent enterprises said the disease outbreak has cut their consumer markets, with nearly 60 percent of those saying the pandemic has resulted in a lack of capital and cash flow.

More than 40 percent of enterprises said the epidemic has led to a shortage of materials, and 43 percent said they have had to lay off workers.

Up to 30 percent predicted their 2020 revenue will fall by between 30 and 50 percent, while 22 percent said their revenue will fall by more than half.

The survey also found that if the epidemic continues then 30 percent of enterprises will not be able to maintain operations for more than three months and 50 percent will not last longer than six months at most.

VCCI has proposed authorities quickly apply provisions of the Labor Code 2019 previously scheduled to take effect from 2021, he said, which allow businesses to pay workers a minimum of 14 days’ salary in case of natural disasters and epidemics.

The business community desperately needs support from workers and consumers to overcome these difficult times, he added.