100 trillion VND loan for high-tech agriculture
Updated at Wednesday, 29 Mar 2017, 14:03
The Hanoitimes - Deputy Governor of the State Bank of Vietnam (SBV) Nguyen Dong Tien said that all commercial banks have committed to implement the credit package in accordance to the Government’s instructions.
Prime Minister Nguyen Xuan Phuc has signed a resolution providing a credit package worth 100 trillion VND to invest in the development of high-tech agriculture at lower-than-market rates.
The resolution stipulates that commercial banks must cut operation costs so they can set interest rates for enterprises or individuals engaged in high-tech agriculture production at 0.5-1.5 per cent lower than the current commercial interest rates.
SBV Deputy Governor Tien said that the bank has considered the credit package imlementation as its main plan in 2017.
The SBV held a meeting with commercial banks with outstanding loans for agricultural and rural loans to implement consulted with commercial banks on the implementation of this credit program, he added..
"The commercial banks are backing the government’s decision and have registered to participate in the 100 trillion VND credit package, ensuring the Prime Minister's instructions to lend effective projects with favorable interest rates," said Tien.
The Agribank have registered a credit package of 50 trillion VND for this sector, Lienviet Post Bank and Vietcombank each registered 10 trillion VND, and BIDV is also applying for a credit package of 10 trillion VND.
Director General of Agribank, Tiet Van Thanh, and deputy director general of Vietcombank, Dinh Thi Thai, expressed support for the government’s decision. Yet they asked for clear legal requirements on the part of borrowers, including required collaterals to avoid risks. “Low interest rate risks are very high,” lamented Thai.
While making his speech at the recent conference in Hanoi, Deputy Prime Minister (PM) Vuong Dinh Hue said that “before implementing the credit package, the Government, concerned ministries and sectors have to define what is high-tech agriculture and its framework – including high-tech agriculture application, green agriculture and the technology which will be applied.”
The Deputy PM also stressed the need to define “short term, mid term and long term credit packages” to be applied in this programme.
Photo for illustration.
Regarding the loan framework, Deputy PM Hue asked whether the credit should be disbursed according to development stages of high tech production, or not. He also asked whether individual household involved in high tech production should be included in the list of eligible borrowers, particularly big production households.
According to the deputy PM, over the past few years, only roughly 20 enterprises involved in high-tech agriculture accessed credit at low interest rates.
He emphasised the importance of credit packages for high-tech agriculture in the context of the slow growth of the country’s primary industry.
Deputy PM Hue said the Government had already worked out a legal corridor to implement the strategy on high-tech agricultural development.
He assigned the SBV to instruct all commercial banks to implement the credit package in accordance to the Government’s instructions and asked the bank to work closely with the MARD to periodically monitor the credit programme implementation.
To support banks involved in the program, the deputy PM required the Ministry of Finance to complete as soon as possible a Government decree on agriculture insurance.
Translated by Thu Minh