Off to a Small, but Sure Start : Loan Program Helps Vietnamese Refugees Set Up Own Businesses

Thu Trong Nguyen owns a business so small, it’s not even called a small business. It’s called a “micro-enterprise,” but on it the 52-year-old former captain in the South Vietnamese Army is building his American dream.

With a $5,000 loan from a new federal program designed to remove refugees from the welfare rolls and additional money provided by friends, Nguyen just a month ago started a sewing business with his wife and three children.

Gee Fashion on Garden Grove Boulevard offers Nguyen, who arrived in the United States last year, a new beginning.

“This is an opportunity I am thankful for,” said Nguyen, who drove trucks and learned to sew to survive in Vietnam after his release from a Communist re-education camp in 1982. “I’m glad, even if we have to start all over again.”

Nguyen is one of 24 Vietnamese refugees, many of them former South Vietnamese soldiers and officers, who are participating in the Self-Employment Micro-Enterprise Development program in Southern California. The program was started in 1991 by the U.S. Office of Refugee Resettlement.

It is intended to help the newly arrived refugees, who often cannot find work, start their own business and be self-sufficient, according to Carmela Thompson, project director for the refugee resettlement agency.

Following approval of a business plan, individual loan applicants may receive $2,000 to $3,000, while couples may get $3,000 to $5,000 to start businesses, such as sewing, swap-meet retailing, gardening, window cleaning or shining shoes.

Loan recipients must undergo training in accounting, marketing, advertising, business and regulations, Thompson said. The loans, which do not require collateral, are at 9.3% interest and must be repaid within a year, though the program continues to offer counseling and other support to its clients.

The program helps refugees “create a credit history that will enable them to qualify for a traditional bank loan,” Thompson said.

The program in Southern California is one of 12 nationwide administered by nonprofit groups receiving federal grants.

Giao Hoang, executive director of Economic and Employment Development Center, said the Los Angeles-based agency has run the Southern California loan program on a three-year, $395,000 grant from the federal government.

One problem with the shoestring program is that the loans are often too meager to start a viable business. Others say that it would be better to just stay on welfare.

“I say to them: ‘Don’t rely on welfare. It will make you dependent on the government, and the community will look down on you,’ ” Hoang said.

Because the loan amounts are small, Hoang said, many refugees also borrow money from relatives and friends to get their businesses started.

Nguyen borrowed $10,000 from a family friend to add to his capital, buy the machines he needed, lease a 1,400-square-foot space and pay for the permits and business licenses.

It is a good thing, Nguyen said, that he did not have to hire anyone; his wife, Bon Kien, and children assist him with some of the work.

Though Nguyen opened a small shop in a business park, many refugees run their businesses from their homes to cut costs. Others hawk their merchandise at swap meets.

Tam Thanh Nguyen, 39, buys broken television sets, VCRs and video cameras and fixes them at his Garden Grove home. He then sells them at swap meets around Orange County.

“I want to have a shop, but I can’t afford it,” said Tam Thanh Nguyen, who started his business with a $3,000 loan in May. He spent three years in a labor camp before arriving in the United States in 1990 with his wife and two sons.

Pau S. Thong, 57, and his wife, Tran Ngoc Luong, 51, sell T-shirts and other clothing at the Asian Mall in Little Saigon. They received a $3,000 loan last year.

Thong, who spent three years in labor camps before coming to the United States in 1990, said he wants to expand his business but feels he is getting too old to still be working.

Hoang said that is a common feeling among refugees who have spent time in re-education camps.

“They are often broken physically and mentally,” Hoang said. “They have lost their energy and just want to spend the rest of their lives in peace.”

Thu Trong Nguyen, however, says he feels he is just starting his life.

“I try not to think about the past,” he said. “I look to the future. I was born in Vietnam, but I’ll die an American.”