In focus: Schemes and policies for women entrepreneurs in Vietnam
Vietnam today has emerged as a ‘rising star’ in Asia, backed by awe-inspiring progress – both economically and socially. And, what’s more impressive is that by 2035, Vietnam aims to graduate from lower-to upper-middle income status and become a prosperous, creative, equitable and democratic society.
Over the past three decades, Vietnam has shown steady signs of progress in increasing the number of women entrepreneurs. So, it appears that creating more female entrepreneurs is a central part of the government’s agenda, as women constitute 50% of the population and another strong point is that the economic empowerment of women increases social and economic benefits.
Here are some schemes and policies that favour the growth of women entrepreneurship in Vietnam.
> Gender Equality Strategy: National Strategy on Gender Equality for the 2021-2030
The Vietnamese government has put upfront the need to increase the participation of women in the workplace. To help facilitate these goals, the Vietnamese government has adopted the National Strategy on Gender Equality for the 2021-2030 period. And the strategy aims to foster Vietnam’s gender equality and women entrepreneurship. But, despite progress in narrowing the gender gap recently, Vietnam still faces challenges considering deep-rooted gender stereotypes and a ‘gendered structure’ economy.
The country’s Gender Equality Strategy 2021-2030 set targets that by 2025, 60% of state agencies and local governments must have women in key leader positions, rising to 75% by 2030. The Vietnamese government hopes to come face-to-face with more women business owners, accounting for 27 % of all enterprises by 2025 and 30 % by 2030.
With women making up approximately 50 percent of the population, encouraging women entrepreneurship is central to this strategy. The plan also defines specific goals for Vietnam to promote gender equality in various areas, as part of Vietnam’s Sustainable Development Goals (SDGs) by the UN. Since the plan’s approval in March 2021, the government has been implementing new policies and initiatives to foster its implementation.
The government also executed flexible online training programs on digital technology for women-owned SMEs and has provided financial and non-financial services to vulnerable women.
> Vietnam Womens’ Union (VWU)
Founded in1930, Vietnam Women’s Union (VWU) is a socio-political organization, representing the legal and legitimate rights and interests of Vietnamese women of all strata. The VWU strives for women’s development and gender equality. The association is a member of the Vietnam Fatherland Front, Women’s International Democratic Federation (WIDF) and ASEAN Confederation of Women’s Organizations (ACWO).
Today, the Union has united, mobilized, and rallied women across Vietnam – to promote the tradition of patriotism, heroism, indomitableness, faithfulness and resourcefulness and, thus actively contributing to the construction and defense of the socialist country Vietnam with wealthy people and a democratic, equitable and civilized society.
During its existence of more than 90 years, the VWU has organized 13 National Women’s Congresses. The 13th National Women’s Congress (2022-2027 period) was organized at the National Convention Center in Hanoi from 9th– 11th March 2022.
> Vietnam Association of Women Entrepreneurs (VAWE)
The Vietnam Association of Women Entrepreneurs (VAWE) was launched in Hanoi on October 2014, with Deputy Minister of Industry and Trade HoThi Kim Thoa elected as the organisation’s first President.
The VAWE aims to improve the capacities and roles of businesswomen in Vietnam; and it also provides a forum for them to enhance their professional knowledge and to share their experiences. It also protects the legitimate interests of women entrepreneurs and members of the workforce.
For its first term – from 2014-2019, the association’s key task was to become a platform that connects businesswomen in all economic sectors and inspires them to undertake maximum efforts in their fields of work – to contribute to national development.
Plus it also serves as a bridge between women in the business community and Government agencies – with a view to informing socio-economic development policies. One thing can be clearly highlighted – the country continuously strives to enhance the female business community, which plays an important role in modernisation and industrialisation. Also VAWE assists businesswomen improve their capacities and skills – to contribute to socio-economic development and social equality.
In fact, the ministry tries to research and develop policies that support both male and female entrepreneurs in running their businesses effectively.
> SME Development Fund (SMEDF)
The SME and entrepreneurship support programmes in Vietnam are many. The SME Development Fund (SMEDF) is an important policy initiative.
The SMEDF was established in April 2013, with an initial capitalisation of VND 2 trillion from the state budget, and became operational in April 2016. The Ministry of Planning and Investment (MPI) is responsible for its implementation.
Funding to SMEs from the SMEDF is largely channelled through partnering banks. The selection criteria of the SMEDF include innovativeness (including new business models), employment creation, environmental savings, and evidence of good administrative/management practices. Partnering banks make their loan appraisal based on guidelines issued by the SMEDF.
The SMEDF loan offers a simplified application process that can be submitted online at one of the partnering banks. Alongside, SMEDF operates a call centre to help SMEs complete the loan application form and, through an informal network of service providers, advise SMEs on how to develop a loan proposal.
Women’s entrepreneurship support is currently mostly the outcome of international donor initiatives.
It is to the credit of Vietnam that it includes a definition of woman-owned SMEs in the SME Support Law (i.e. one in which one or more women own at least 51% of its charter capital). However, the only specific provision for women-owned SMEs in the SME Support Law is a 100% subsidy for training expenses related to business administration. Interestingly, the AED does not have any specific programme targeting women entrepreneurs, depending instead on support for women’s entrepreneurship development from the Viet Nam Women Entrepreneurs Council (VWEC), the Viet Nam Women’s Union, and NGOs. So, it follows that women’s entrepreneurship is currently mostly supported through international donor funding in Viet Nam. Notable initiatives include:
• The USAID Governance for Inclusive Growth initiative, a grant to the Viet Nam Association for Women Entrepreneurs in 2018 to organise training programmes to promote innovative business start-ups among women entrepreneurs and strengthen the network of women entrepreneurs.
• The Netherlands-funded “Enhancing Opportunities for Women’s Enterprises” 2016-2020 project, a partnership with the Viet Nam Women’s Union to support rural women in entrepreneurship.
• The Global Affairs Canada-funded Women’s Initiative for Start-ups and Entrepreneurship 2018-2025 Programme, which supports women entrepreneurs and women-led start-ups with consultancy, training, mentoring, networking, and access to capital and markets.
• The partnership of the US Embassy American Centre in Ha Noi with the Viet Nam Women’s Union and the Viet Nam Women’s Academy to deliver the “Start-up Smart for Women” training course for women entrepreneurs in 16 provinces in northern Viet Nam.
• The ILO Gender and Entrepreneurship Together (GET Ahead) training project for women in business in Viet Nam, which has trained Vietnamese trainers in the GET Ahead methodology to deliver the training.
• The Australian Aid’s Investing in Women Initiative 2012-2020 (AUD 4 million), a partnership with the MPI, which seeks to improve women’s economic participation and build markets for women, including by encouraging investment in women-owned SMEs.
Apart from these donor-funded initiatives, the project “Supporting women in starting a business in the period 2017-2025”, initiated by the Vietnam Women’s Union an approved through Prime Minister’s Decision in June 2017, proposes to provide support to 20 000 women’s start-ups and the establishment of 1200 women-led or women-managed co-operatives. This project encompasses a series of activities, including entrepreneurship skills training courses, matching fairs for women to exchange and learn, trade promotion, incentives for women to develop business ideas, and support for completing business plans and accessing resources to realise the plans.
> Government Incentives for SMEs
The government issued two regulations in 2019, to help and incentivize small and medium-sized enterprises (SMEs) – on the network of consultants for SMEs and on subsidies for training courses for women-owned SMEs.
SMEs play a major role in Vietnam’s economy and account for 98 percent of all enterprises with approximately 40 percent of GDP. While the government has made a number of reforms, SMEs continue to face challenges relating to credit, human resources, market access, and competition with foreign firms.
The latest incentives will further allow for a thriving environment for SMEs, given their importance. The government is also expected to launch an online platform for organizations and individuals to register and be automatically admitted to the consultant network.
SMEs will then be able to look up information on the consultant network, including the name, registration number, and other details on the websites of the National Portal as well as the local ministry websites, such as the Government Inspectorate.
The government also provides subsidies for Human Resources of SMEs owned by women. A women-owned SME as defined by the government is one or more women who own at least 51 percent of its charter capital. Details are: The government will provide 100 percent subsidy for expenses for training in entrepreneurship, business administration, and advanced business administration for women at women-owned SMEs; a 100 percent subsidy of expenses in training courses for employees of SMEs located in extremely disadvantaged areas; and a subsidy of at least 50 percent of expenses for organizing a training course in entrepreneurship and business administration.
The government will then open accounts for SMEs to join online training courses.