Tuesday , February 27 2024

PM Chính urges measures to boost credit growth

 

Prime Minister Phạm Minh Chính chairs a conference outlining solutions needed to remove difficulties in credit growth on Thursday. VNA/VNS Photo

HÀ NỘI — Prime Minister Phạm Minh Chính on Thursday chaired a conference outlining solutions needed to remove difficulties in credit growth in order to foster businesses and ensure macroeconomic stability.

During the conference, participants expressed that credit growth is still low while there is significant room for credit expansion. Despite recent reductions, interest rates remain high compared to the repayment capacity of businesses. Non-performing loans tend to increase, posing risks to the safety of the system.

In particular, participants pointed out that access to credit for the economy is still challenging, loan procedures still complex, and the demand and absorption of capital by the economy facing difficulties.

Therefore, they proposed solutions on laws, interest rate, debt structure and loan limits to promote credit growth for production and business.

At the conference, PM Chính highly valued the opinions presented, urging relevant ministries and sectors to review mechanisms, policies, regulations, and promptly handle and resolve the recommendations.

He emphasised that the socio-economic situation in November still faces many difficulties. By the end of November, new credit debt had increased by below 9 per cent, compared to a 12 per cent increase during the same period last year.

The target for the entire year 2023 is around 14 per cent. The remaining capacity of the entire system for credit institutions to expand credit growth is significant, with over VNĐ700 trillion (US$28.8 billion) available for the economy.

Results from implementing preferential credit programmes have not met expectations, especially the VNĐ120 trillion package for social housing construction, he added.

The Prime Minister pointed out the complexity of loan procedures and high interest rates as among the reasons for this. The reduced absorptive capacity of the economy contributes to the challenges, with some businesses in need of loans failing to meet the borrowing conditions.

PM Chính affirmed that credit standards will not be adjusted, and suggested measures to enhance access to credit and promote the banking sector.

He instructed the State Bank of Vietnam (SBV) to closely monitor the situation for proactive, flexible and effective monetary policy management. The priority is to stimulate economic and credit growth while ensuring the safety of banking operations and the credit system.

The SBV must implement credit solutions aligned with macroeconomic developments, and improve the quality of credit, directing credit institutions to more aggressively implement measures to further reduce lending interest rates. Additionally, there should be a strong push for the effective deployment of credit incentive packages suitable for the specific characteristics of each credit institution, he said.

The Prime Minister also requested the SBV to explore the possibility of publicly disclosing the average interest rates of the credit system and the average lending rates of individual credit institutions, along with the spread between the average deposit and lending rates. This transparency aims to provide businesses and individuals with the ability to choose banks with lower interest rates.

The SBV must continue to direct the effective implementation of the VNĐ120 trillion ($4.9 billion) credit package for the development of social housing and the VNĐ15 trillion ($640.5 million) preferential package for the forestry and aquaculture sectors.

He urged the SBV to implement the project on restructuring the system of credit institutions for the period of 2021-2025; continue to effectively control and prevent cross-ownership situations and cross-lending practices that may jeopardise the safety of the system.

The SBV, in coordination with relevant ministries and sectors, will continue to implement measures to develop the corporate bond market.

PM Chính asked credit institutions to continue directing credit sources into production and business sectors, prioritised areas and economic growth drivers following the Government’s guidelines.

Strict measures should be taken against banks that impose conditions and requirements outside the regulations, hindering access to credit. Violations such as the practice of concentrating loans on certain companies or projects within the system of or affiliated with groups that could compromise the safety and healthiness of banks, and the opening of low-interest credit rooms for bank leadership must be handled, he added.

The head of the government directed the Ministry of Finance to continue coordinating and tightly managing fiscal policy, ensuring harmony with monetary policy to promote investment. The ministry needed to strengthen measures to stabilise and develop a truly healthy corporate bond market, ensuring an efficient and healthy stock market, and enhance guidance on the proper legal procedures for the purchase and trading of corporate bonds.

For the Ministry of Construction, the Prime Minister instructed it to closely monitor the real estate market dynamics to timely propose appropriate policies for market development. He also asked the ministry to urge localities to announce social housing projects eligible for funding under the VNĐ120 trillion preferential credit programme and implement the investment project on constructing at least 1 million social housing units for low-income groups and industrial zone workers.

The Prime Minister assigned the Ministry of Planning and Investment to devise more effective measures to enhance the activities of the credit guarantee fund for small- and medium-sized enterprises and the small- and medium-sized enterprise development fund to increase the credit accessibility for these enterprises.

He also asked the ministry to consider adjusting the use of the VNĐ40 trillion credit package, which supports a 2 per cent interest rate from the State budget under the economic recovery programme. The adjustment should aim to choose more suitable and effective targets and methods.

The Ministry of Industry and Trade was assigned to boost trade promotion, expand the export market, and effectively apply free trade agreements to stimulate exports and increase export orders.

The Ministry of Public Security continues the policy of not criminalising economic relations, but implements solutions to address violations by undercover entities and individuals engaged in currency trading. This aims to strengthen and develop the system of financial institutions for consumer loans, contributing to curbing illegal lending, he said.

Associations were urged to enhance information gathering on difficulties and challenges faced by their members, promptly conveying them to relevant authorities. — VNS

 

Read More :
- Reduce Hair Loss with PURA D’OR Gold Label Shampoo
- Castor Oil Has Made a “Huge” Difference With Hair and Brow Growth
- Excessive hair loss in men: Signs of illness that cannot be subjective
- Dịch Vụ SEO Website ở Los Angeles, CA: đưa trang web doanh nghiệp bạn lên top Google
- Nails Salon Sierra Madre