April records highest number of new firms

The number of newly registered enterprises in Vietnam peaked in April among monthly figures at 15,967, indicating improved business sentiment, according to the Department of Business Registration Management.

The record high was a 6.4% increase from a year earlier. However, registered capital dropped by 5.7% to more than VND154.6 trillion ($6.6 billion), the department, under the Ministry of Planning and Investment, reported.

Newly established firms took in 119,089 registered employees, up 13.7% over April last year. Notably, this April saw 9,610 enterprises rejoin the market, up 36.6%.

However, the number of returning businesses in the first four months was some 29,000, down 6.2% year-on-year. But it is 1.5 times higher than the January-April average of the 2018-2022 period.

In the other direction, 14,509 businesses nationwide withdrew from the market this April, up almost 40% from a year earlier. Half of them halted operations, up 33%; 5,837 are in the process of dissolution (up 55.2%); and 1,509 has already dissolved (up 23%).

In the first four months, 77,001 firms left the market, up 25%. A majority of them, almost 65%, temporarily ceased operations.

Amid the current credit crunch, the Department of Business Registration Management put an alarm on raising capital as the average registered capital per enterprise in the four months was just VND9.3 billion ($396,300), the lowest of its kind since 2018.

All newly registered enterprises in the period have a combined capital of almost VND495 trillion ($19.8 billion), equal to 70% or a little higher compared with the same period in 2021 and 2022 when the pandemic wrought havoc.

Vietnam's industrial production expanded by 0.5% year-on-year in April, but fell 1.8% in the first four months of the year amid weaker global demand, according to the General Statistics Office (GSO).