Bank sets aside $666 million for loan program for sector so it may compete during integration.
The Bank for Investment and Development of Vietnam (BIDV), the Vietnam National Textile and Garment Group (Vinatex), and the Vietnam Textile and Apparel Association (VITAS) held a roundtable discussion on September 30 in Hanoi regarding the opportunities and challenges for garments and textiles during integration.
BIDV believes textiles and garments require support policies to operate effectively and so has introduced a loan program for importers and exporters for this year and next year totaling VND15 trillion ($666 million). Textile and garment enterprises have been classified as VIP customers of the bank and can access loans at preferential interest rates and conduct transactions for 20 per cent less.
“In the last five years, due to wasted land resources, enterprises have not had raw material areas and are unable to prove the origin of their exported goods, so their products may be returned despite the tax benefits available from free trade agreements,” said Chairman of BIDV, Mr. Tran Bac Ha. “If enterprises can find suitable land for developing raw materials BIDV commits to being flexible on credit access, with lower interest rates.”
He also suggested enterprises invest in fiber and dye to create a complete production line. BIDV will also spend $2 billion over the next five years on supporting textile enterprises to invest in finished products and semi-finished materials and provide VND10 billion ($444,444) for trade promotion activities.
Outstanding loans to the bank in the sector stood at VND391 billion ($17.4 million) as at June 30, 2015.