In many developing countries, obtaining financial services at affordable rates and fair terms has been a significant challenge for small and medium enterprises (SMEs). However, this issue has not been paid much attention in Vietnam, even though SMEs account for about 95% of total enterprises and the financial market of the country has not been well developed. This study investigates the causal effects of access to finance on productivity of SMEs operating in the manufacturing sector in Vietnam. Productivity was measured as the total factor productivity (TFP) obtained by production function estimation using the Levinsohn and Petrin approach. Regarding financial accessibility, two factors covered the extent to which firms might have a bank loan or overdraft facility were employed. To study the causal inferences of access to finance on firm productivity, the research adopted the difference-in-differences (DID) approach, as well as the propensity score matching (PSM) coupled with DID technique. The empirical results indicated that improving the financial accessibility could directly enhance firm productivity. Particularly, it was shown that firms having access to a bank loan could significantly improve TFP by approximately 8.6% in the DID model and about 9% in the PSM-DID model. Meanwhile, the firm average TFP increased by approximately 12.3% and 15.7% in simple DID and PSM-DID models, respectively, when firms had an overdraft facility. These findings suggest that the government should put more effort into assisting SMEs in generating bankable projects, and create a sound and healthy financial environment to stimulate firms’ access to finance, which will ensure their sustainability and growth.

The riverine ecosystems of the Mekong River Basin possess the world’s most productive inland fishery and provide highly productive food crops for millions of people annually. The development of hydropower potential in the Mekong River has long been of interest to governments in the region. Among the existing 64 dams, 46 dams have been built in the Lower Mekong Basin (LMB) to produce up to 8650 MW of electricity. Additionally, of the 123 proposed built hydropower dams, eleven hydropower plants have been nominated for the river mainstream and are expected to install a total of 13,000 MW in the LMB countries. However, serious concerns have intensified over the potential negative economic consequences, especially on fisheries and agriculture in Cambodia and Vietnam. To date, most of the concerns have concentrated on the impacts on hydrology, environment, livelihood, and diversity in the LMB attributed to hydropower development. This paper, however, discusses the fishery and agricultural sectors of the LMB and focuses on the downstream floodplains of Cambodia and Vietnam. The dam construction has caused greater losses of biodiversity and fisheries than climate change in the LMB. The reduction of 276,847 and 178,169 t of fish, 3.7% and 2.3% of rice, 21.0% and 10.0% of maize will contribute to a decrease of 3.7% and 0.3% of the GDP of Cambodia and Vietnam, respectively. Lao PDR may benefit the most revenue from electricity generation than the other country in the LMB, as most of the proposed dams are projected in the country. Cambodia burdens 3/4 of the reduction of total capture fishery destruction, whilst Lao PDR, Thailand, and Vietnam endure the remaining 1/3 losses. The tradeoff analyses reveal that losses of capture fisheries, sediment or nutrients, and social mitigation costs are greater than the benefits from electricity generation, improved irrigation, and flood control of the LMB region. The socioeconomic and environmental damage caused by hydropower dams in developing countries, including the Mekong, is greater than the early costs in North America and Europe. It is proposed that dam construction for hydropower in the Mekong River, as well as other rivers in developing countries, should be gradually removed and shifted toward solar, wind, and other renewable resources.

Investment climate has been acknowledged as a key factor that significantly influences economic performance. Improving the investment climate may foster the development of the private sector by creating sustainable jobs and opportunities for entrepreneurs, which contributes to sustained poverty reduction in developing countries. This research examined the relationship between the investment climate and firm productivity by exploring a unique panel dataset of 1310 enterprises operating in the manufacturing sector in Vietnam. Productivity was measured as the total factor productivity (TFP) obtained by production function estimation using Levinsohn and Petrin’s approach. Investment climate factors included infrastructure, labor skills, regulatory governance and institutions, and access to finance. It was shown that restrictions on the investment climate were harmful to firm productivity. The lack of Internet and financial accessibility, low educational level of employees, administrative burden and the cost of bribery were negatively associated with firm TFP. The results indicate that access to Internet and finance, and quality of labor should be further enhanced while administrative burden and corruption should be significantly reduced to strengthen the TFP. The findings of this study may provide insights for policymakers who aim to improve the investment climate and firm productivity and thereby contribute to the sustainable growth of the country.