High financial leverage drives SMEs in Vietnam towards seeking new investments.
Small and medium-sized businesses in Vietnam face challenges in getting money for new investments. A study looked at how these businesses decide to invest and where they get their money from. The study found that businesses with a lot of debt are more likely to seek new investments. Also, businesses with more debt prefer to get money from outside sources rather than using their own funds. This shows that the way businesses choose to finance their investments is influenced by how much debt they have.