Local small- and medium-sized enterprises (SMEs) need to reform themselves and also need support from the State to survive and develop as further economic integration takes place once Vietnam signs free trade deals with partners, experts said. Now, the SMEs account for 96 percent of the total number of enterprises in Vietnam whose operations and finance are on a small scale and which have low competitive ability, according to the General Statistics Office. Meanwhile, economic experts said most of the SMEs did not have much knowledge about global economic integration and do not know how and what to do as the economy integrates further with the global structure, the Tin tuc (News) newspaper reported. The SMEs also do not know the demand of the world market, neither do they know the world quality standards and commercial rules, the experts said. A representative of the HCM City Food Association said 80 percent of the members at the association are SMEs who did not have access to information about international economic integration. Cao Sy Kiem, Chairman of the Vietnam Association of Small and Medium Enterprises, said key issues for the SME as well as local enterprises in general include the need to improve their competitive ability by diversifying products and ensuring reasonable selling price. To achieve the targets, he proposed that interest rates for medium- and long-term loans should be at 7 percent per annum against 9 percent to help enterprises have attractive sale price. Kiem said the state should come up with ways to enhance the number of skilled workers in enterprises and use of modern production technology to improve competitiveness of the enterprises. This was necessary because Vietnam lacks good managers and policy makers as well as skilled workers. CEO Dang Duc Thanh, Head of the Vietnam Economist Club, said Vietnam has in the past improved its business environment to integrate into the global economy but the nation does not have many strong enterprises that are highly competitive and efficient. To reach the targets, the State Bank should adjust credit structures to focus credit on production, business, rural area, exports, supporting industry and SMEs, Thanh said. The state should build and develop a system of economic policies to support the SMEs in production and business and credit guarantee funds for SMEs, said Thanh, adding that the state should also reform administrative procedures and complete the legal system to protect the SMEs as well as local enterprises in general. Dau Anh Tuan, Head of the Legal Department under the Vietnam Chamber of Commerce and Industry, said information, support and consulting for enterprises as they integrate into the world economy are very important. Therefore, the state should provide information about what free trade agreements will involve. That would help local enterprises to take appropriate steps in the areas of production and business to integrate better with global system.-VNA