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Loan programme to spur small business
The Government plans to offer low-interest loans to small businesses in remote areas to spur economic growth, according to a recent decision by Prime Minister Nguyen Tan Dung.
Beginning September 5, businesses will receive loans from VND30 million (US$1,600) to VND500 million, depending on the size of the company.
Small dealers who operate informally and pay a flat tax rate will be given VND30 million loans, but larger established companies can borrow up to VND500 million. Loan terms will be short, medium and long (maximum of five years).
To qualify for loans, traders must be permanently located in their area and have capital equal to at least 20 per cent of the loans.
Traders who receive VND30 million loans will not be required to follow special security requirements, such as collateral.
According to a survey by the General Statistics Office, more than 1.85 million non-farm businesses are located in mountainous and remote areas.
The total retail goods and consumer services' turnover in mountainous provinces is VND280 trillion a year on average.
Tran Bao Giam, deputy director of the Ministry of Industry and Trade's Mountainous and Border Trade Department, said most traders were individual retail businesses with little financial capacity.
In recent years the Government has launched initiatives to help improve the economy in remote areas, but a lack of capital has prevented companies from prospering.
Dr. Pham Thanh Ha of the Region I Politics and Administrative Academy said the loan support programme was long overdue. For it to succeed regulations must be written clearly and implemented properly, he added.
Household-based businesses involved in production should also be included in the loan programme, he said.
VietNamNet, VietNamNews
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