Banks to provide support to customers affected by coronavirus

An empty shopping centre in Hanoi during the coronavirus epidemic. (Photo: VNA)

With the epidemic significantly affecting business, production and daily life, the central bank’s Governor Le Minh Hung has told banks to actively keep a watch on production and business situations of customers who could be affected by the epidemic and evaluate the possible impact. Focus must be placed on the most vulnerable sectors such as tourism, agriculture and exports so measures can be put in place, he said in a recent document sent to commercial banks.

Support could include rescheduling debt payments and reducing lending interest rates.

The central bank also asked credit institutions nationwide to enhance cooperation with local management agencies to remove difficulties for affected businesses and borrowers.

According to a report published on Monday by SSI Securities Corporation, a number of industries would suffer negative impacts from the coronavirus epidemic in the short term.

As export-import played an important role in the Vietnamese economy, any interruptions from important suppliers like China could be challenges to the country’s economic growth.

“Export of agricultural products and tourism will be negatively affected, at least in the short-term,” the report wrote.

Among 23 industries SSI surveyed, 10 were predicted to suffer, including banking, garment and textile, retail, seafood, beer, petrol and oil, security, transportation, airport and aviation services.

Only four industries might benefit, namely pharmaceutical production, information and technology, electricity and water.

For example, the epidemic did not have direct impact on the demand for garment products but China’s GDP slowdown might hit consumption demand in the long term, which would affect garment and textile production of Vietnamese firms. Currently, China was the largest supplier of fibre for Vietnam.

Regarding the retail industry, the report pointed out that shoppers would tend to turn to online shopping, instead of going to traditional markets and stores.

Deputy Minister of Industry and Trade Tran Quoc Khanh recently said that e-commerce with new delivery methods should be promoted as a measure to fight the epidemic.

A recent report by VnDirect Securities Company also said that the demand for online shopping and delivery services would increase significantly.

The Bao Viet Securities Company predicted that Vietnam’s GDP in the first quarter of this year would grow at 6.5 per cent, 0.29 percentage points lower than the same period of 2019. Recovery could follow but might depend on the development of the epidemic.

The company forecast that Vietnamese economy might suffer until the end of the second quarter.