The role of small and medium-sized enterprises in the economic growth of Ho Chi Minh City

Abstract

In recent years, small and medium-sized enterprises (SMEs) have made significant contributions to the economic growth of Ho Chi Minh City (HCMC). According to data from the Statistics Office in 2021, SMEs accounted for approximately 98% of the total number of enterprises in the city, contributing over 23% of GDP and creating employment for about one-third of the local workforce, thereby promoting the structural transformation of the economy in a positive direction. Beyond their role in the city’s economic growth, SMEs are also a key driver of Vietnam’s sustainable economic development. This study focuses on exploring the critical role of SMEs in HCMC’s economic growth. The main objective is to analyze the contributions of SMEs from 2013 to 2023, highlighting both their achievements and the challenges they face in enhancing their impact on the economy. Using a descriptive statistical methodology, the study examines key aspects such as GDP contribution, job creation, and sectoral distribution to emphasize the role of SMEs in driving growth and economic transformation. The research findings indicate that SMEs account for 98% of all enterprises in HCMC, contribute over 23% of the city’s GDP, and employ nearly 25% of the workforce, underscoring their vital role in economic development and structural transformation. However, despite these significant contributions, SMEs encounter numerous challenges, particularly in accessing capital and expanding market reach. These barriers directly affect their growth potential, development, and competitiveness in the context of economic integration and external influences. Notably, the unexpected impact of the COVID-19 pandemic has posed severe difficulties for many SMEs, exposing vulnerabilities in their ability to respond to economic fluctuations. As a result, strengthening resilience and enhancing the competitiveness of SMEs has become an urgent necessity. This study provides in-depth insights and practical recommendations for policymakers and business practitioners to strengthen the role of SMEs in HCMC’s economic growth while also improving their resilience and long-term sustainability in a rapidly evolving economic landscape.