The Government has plans to offer a credit package amounting to VND100 trillion for enterprises committed to hi-tech agriculture projects, heard at a conference on the agricultural sector last week.
The commercial credit package will offer lower interest rates than normal ones.
The Government has assigned the State Bank of Vietnam to instruct commercial banks to offer interest rates of 0.5% to 1.5% for enterprises involved in hi-tech agriculture projects, according to Nguyen Thi Hong, head of the Planning Department at the Ministry of Agriculture and Rural Development.
She added the ministry and the State Bank had prepared a draft rule on the implementation of the package.
The draft will go before the Prime Minister for consideration this week.
It will be carried out in the same way as the VND30 trillion credit package for buyers of affordable homes, said Minister of Agriculture and Rural Development Nguyen Xuan Cuong at a Government meeting last month.
Commercial banks have already disbursed around VND300 billion for clean and hi-tech agriculture projects with interest rates 0.5-1.5 percentages points lower than normal levels.
Cuong threw his support behind the scheme, saying it will be feasible in line with the market mechanism and can be launched immediately.
Enterprises are pinning high hopes on the credit package but commercial banks should join the package based on market principles rather than administrative decisions.
Many banks are willing to take part in the package.
However, guidelines for issuing ownership certificates for assets on agricultural land should be streamlined, creating a legal framework for facilitating transactions and mortgages, according to SBV Governor Le Minh Hung at the meeting.
“Enterprises want to invest in large-scale projects but due to the lack of proper guidelines, they can neither register their assets nor arrange mortgages. We propose the Ministry of Agriculture and Rural Development coordinate with the ministries of justice, and natural resources-environment to solve the issue,” he said.
Prime Minister Nguyen Xuan Phuc said the package should be funded by capital from commercial sources, not subsidies.