Disbursement kick to offer safety net for businesses

September 14, 2022 | 08:00
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Implementation of the national fiscal and monetary initiative has seen a quicker step forward, making it more favourable for enterprises and people to relieve their difficulties.

Prime Minister Pham Minh Chinh last week urged ministries, authorised agencies, and localities to soon quicken the deployment of the government’s Resolution No.11/NQ-CP dated January 30 on the country’s Programme on Socioeconomic Recovery and Development (PSRD) for 2022-2023 and the National Assembly’s (NA) Resolution No.43/2022/QH15 dated January 11 on a fiscal and monetary policy worth $15 billion to support the PSRD.

Disbursement kick to offer safety net for businesses
The stimulus package includes billions of US dollars for various types of enterprises, Le Toan

Many enterprises and people are in need of more support from the programme, so disbursement must be sped up effectively, the PM said.

Minister of Planning and Investment Nguyen Chi Dung told the government last week that efforts were being made to carry out Resolution 11 nationwide. Disbursement of spending under the programme hit $2.41 billion in early September, with financing going into a range of areas.

These included $438 million for concessional loans via Vietnam Bank for Social Policies; $132.4 million for housing rental support for nearly 4.54 million workers; $587,000 for a 2 per cent bank lending rate; $1.52 billion for a reduction of VAT and environmental protection tax for aviation fuel; and $321.74 million to extend the tax payment and land rental deadlines until June.

Additionally, $2.26 billion was used for an extension of assorted taxes and land rentals.

Nguyen Cong Bang, owner of Cong Bang Confectionery Co. Ltd., in Hanoi, said he successfully obtained a preferential loan worth VND500 million ($21,700) from Vietnam Bank for Social Policies.

“We used the capital to buy two machines to grind soybeans. Our productivity has significantly increased,” he said. “However, we are now also seeking new loans with a 2 per cent lending rate assistance, but are yet to produce any results.”

In Xuan La area of Hanoi where this company is located, several other companies have also been successfully obtained concessional loans as Bang has done.

Under Resolution 43, the NA has allocated about $7.65 billion, with the vast majority earmarked for completing investment procedures for 264 duties and projects. The remaining $150 million includes $108.7 million that fails to meet conditions for investment and $41.3 million that has been returned without being spent.

Of the $7.5 billion, 94 tasks and projects worth $6.4 billion have completed investment procedures, while those for 168 projects valued at $1.1 billion are ongoing.

“The use of the capital must be reviewed in line with the public investment law. Seven months since Resolution 43 was enacted, the government has been able to collect a portfolio of projects for the programme,” said Deputy Minister of Planning and Investment Tran Quoc Phuong at a National Assembly Standing Committee meeting held on August 29.

At the NA’s third session in June, legislators urged the government to review the $15 billion policy to assist businesses and people, as the package was being rolled out too slowly.

The policy is the first of its kind in Vietnam and came as businesses were struggling to deal with the impact of the pandemic. It aims to help the economy to achieve growth of 8-8.5 per cent this year and 6.5-7 per cent per annum from 2021-2025.

The stimulus includes $2 billion used for purchasing vaccines and medical equipment. The remaining $13 billion consists of two packages, with one worth $5.43 billion and the other valued at $7.65 billion.

The $5.43 billion embraces four sums, including $2.78 billion worth of a 2 per cent reduction of VAT for enterprises, from 10 per cent – this initiative has been implemented so far; $1.67 billion as a credit policy implemented via Vietnam Bank for Social Policies – about one third of this initiative’s value has been already disbursed; $260.87 million as extension of tax payment and reduction of special consumption tax for automobiles and some other types of taxes – implementation of this initiative will be completed at the year’s end; and $286.95 million as assistance for labourers to hire houses – of which only $87,000 has been disbursed.

Meanwhile, the $7.65 billion involves public investment, including $1.82 billion as lending rate support of 2 per cent for enterprises through commercial banks and Vietnam Bank for Social Policies as of January 1; and the remaining $5.83 billion for infrastructure development including $4.48 billion for road and highway construction – however, this sum is slow for disbursement due to incomplete procedures.

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By Thanh Thu

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