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Economists have rHigh unemployment and economic gloomeported the national economy faced numerous challenges during 2012, with many businesses suspending operations or declaring bankruptcy and contributing to the year’s rising unemployment rate.

55,000 businesses dissolved and suspended

The latest statistics released by the Ministry of Planning and Investment (MPI) reveal that as of November 30, 2012, more than 65,000 businesses were operating with a total registered capital of over VND418,853 billion. It represents a 10 percent fall in quantity and an 8.4 percent fall in value compared to the same period in 2011.

As many as 39,936 businesses were suspended and more than 8,500 others dissolved, mostly in the country’s two largest cities Hanoi and Ho Chi Minh City.

Bui Anh Tuan, Deputy Head of the MPI’s Business Registration Management Department, says that the number of newly-established businesses also declined over the past year – from 17,820 in the first quarter to 16,195, 16,978, and 17,300 in the second, third, and fourth quarters, respectively.

He attributes the decline to a frozen real estate sector that had previously enjoyed impressive annual growth of 6–7 percent. A large number of real estate businesses were forced to declare bankruptcy, while many firms have shown interest in moving into other sectors like education, health care, culture, and tourism.

Tuan says other countries including Japan and the US have also suffered increasing incidences of business dissolution in recent years – as much as 10-15 percent. Vietnam’s dissolved and suspended businesses (over 48,470) are still comparable.

In his view, the balance between dissolved and newly-established businesses demonstrates real market development and accords with the national economy’s internal strength.

Nearly 1 million workers unemployed

According to the General Statistics Office (GSO), more than 52 million Vietnamese people were of working age in 2012—up 2.3 percent compared to last year’s figure. Although 2012’s 1.99 percent working age unemployment rate was lower than 2011’s 2.22 percent, the number of unemployed workers rose by 195,000. At present, nearly one million workers are seeking jobs, while 1.45 million others want additional part-time employment.

The GSO says the focus of social welfare should be on stimulating employment to improve people’s living standards.


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