Viet Nam News
The HCM City People’s Committee has issued Decision 15/2017/QĐ-UBND on supporting businesses in investing in developing the manufacturing and supporting sectors. Việt Nam News asks Phạm Thành Kiên, director of the city Department of Industry and Trade, about the implementation of the policy.
In more than two months of implementing the decision on supporting businesses in the manufacturing and supporting sectors, how has the Department of Industry and Trade supported businesses?
Right after the city passed the decision, the Department of Industry and Trade developed plans and sent them to district economic divisions and the management board of the HCM City
Export Processing and Industrial Zone Authority for disseminating the policies on supporting businesses in the supporting industries.
As of today 10 districts have been apprised -- 4, 6, 12, Tân Phú, Tân Bình, Thủ Đức Bình Tân, Bình Chánh, Củ Chi and Hóc Môn – as well as Hiệp Phước Industrial Park in Nhà Bè District with nearly 1,400 enterprises and household businesses.
Along with the dissemination of support policies, the department has actively linked enterprises seeking loans with banks (directly) and with districts’ bank-business linkage programme (which provides preferential loans to businesses operating in the parts manufacturing, hi-tech and agricultural industries and export firms).
Around VNĐ124.32 trillion (US$5.47 billion) was lent to more than 4,138 businesses in the first six months of the year.
In addition, the department has helped businesses with training programmes in industrial production and parts supply, especially management skills and professional skills based on their needs in the case of small and medium-sized enterprises.
Businesses say there are many support policies but without much practical benefit since they still find it difficult to access funds due to lack of collateral and unwieldy administrative procedures. What is your opinion?
Regarding administrative procedures, the Department of Industry and Trade has mapped out a process for handling loan applications under Decision 15/2017 within 13 days from the date enterprises submit the application.
As for collateral, this is the biggest barrier for businesses wanting to participate in the investment stimulus programme. Most enterprises are small or medium-sized and the value of their assets is not high. Therefore to address this problem, the department has worked directly with the banks.
The department has encouraged the Việt Nam Joint Stock Commercial Bank for Industry and Trade (VietinBank) to create a credit package of VNĐ10 trillion for manufacturing and parts supply companies in accordance with Decision 15/2017 under the slogan “Seven year loan at zero interest rate.”
The department has at the same time co-operated with VietinBank and other banks such as Vietcombank and VPBank to directly meet businesses who want to borrow.
How many businesses have benefited so far from the support policies?
Since Decision 15/2017 took effect, the department’s Centre for Supporting Industries Development has advised 32 enterprises wishing to participate in the programme.
Now the department is submitting to the People’s Committee applications from three mechanical engineering firms to participate in the city’s investment stimulus programme.
The department will submit to the People’s Committee more applications when businesses complete the necessary procedures.
What measures does the department plan to take to support businesses?
We have identified support for businesses as a key task to resolve the difficulties faced by them. In 2017 the Department of Trade and Industry has enhanced support for businesses by taking the initative to understand their difficulties and expectations unlike previously when the department mainly received feedback from businesses coming to its office.
In six months the Department of Trade and Industry has called on 162 businesses and listened to their opinions, and thus come up with solutions for the People’s Committee to resolve the difficulties faced by businesses.
In addition, the Department of Industry and Trade will focus on solutions to support enterprises more practically.
Specifically, the department will further accelerate administrative reform, create favourable conditions for enterprises to handle administrative dossiers, implement the programme to connect banks with businesses to help them access bank credit at appropriate interest rates.
The department would do its best to ensure that city businesses would get access to bank loans estimated at VNĐ300 trillion by the end of 2017 by continuing to introduce and carrying out the investment stimulus programme in the industrial and components sectors to encourage firms to invest in upgrading their machinery and equipment and improving technologies.
The department has created a data base for the city’s supporting industries to help businesses seek information when they want to invest in new machinery, equipment and technology to reduce costs.
The department has paid special attention to expanding links between foreign-invested and local businesses. — VNS