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Deputy Governor of the State Bank spoke at the Conference to promote credit to support businesses in the fisheries and rice sectors in the Mekong Delta.

It is difficult to deal with excess money

Information at the Conference to promote credit to support businesses in the rice and aquaculture sector in the Mekong Delta (Mekong Delta) organized by the State Bank of Vietnam in coordination with the People's Committee of Can Tho City and Mekong Delta provinces on September 15, Ms. Ha Thu Giang, Director of the Credit Department for Economic Sectors (SBV), said that as of August 31, credit across the entire economy increased by 5.56% compared to the end of 2022 while the same period increased by 9.88%. The Mekong Delta is an important strategic area, receiving attention from the State Bank and issuing many separate support policies, but credit in this area from the beginning of the year until now has only increased by 5.3%.

According to the State Bank, in the Mekong Delta, agricultural and rural development credit has always received investment attention, with outstanding debt reaching nearly VND 535 trillion, an increase of 6.04% (higher than the region's overall credit growth rate and higher than the average credit growth rate of the region and higher than national agricultural and rural credit growth of 3.75%); accounting for 51.76% of total outstanding debt in the region and 17.44% of outstanding agricultural and rural debt nationwide.

Notably, credit growth for the rice and fisheries industries - strengths of the region - has impressive growth. Outstanding debt in the fisheries sector reached nearly VND 129 trillion, an increase of 8.5% and accounting for nearly 59% of outstanding seafood debt nationwide (of which, outstanding credit for pangasius increased by 10.5%, for shrimp increased by 10.5%. 8.8%). Outstanding debt in the rice industry reached nearly VND 103 trillion, up 9% compared to the end of 2022 and accounting for about 53% of outstanding rice debt nationwide.

"By monitoring statistics over the years, it is expected that from now until the end of the year, credit growth for these two industries will continue to grow rapidly due to crop factors and improved export demand," Ms. Ha Thu Giang said.

However, this credit growth rate is not high compared to the same period last year. Explaining this issue, according to Deputy Governor of the State Bank Dao Minh Tu, the most difficult thing is product consumption, market decline, lack of orders, demand in the world and domestic markets has decreased... so the impact is affect banking activities.

The Deputy Governor of the State Bank also said that bank capital is currently surplus. "Dealing with the problem of lack of money for banks is difficult, but solving the problem of excess money is even more difficult. If there is a lack of money, the State Bank can refinance loans, but if there is too much money, the State Bank cannot save it," the Deputy Governor said.

Implementing capital support policies is still "hesitant"

In this context, promoting credit injection into the economy is an issue of great concern to businesses and management agencies. However, to be able to promote credit, there needs to be solutions from both sides.

At the conference, a representative of Loc Troi Group (An Giang) said that capital flow is being "bottlenecked" when farmers have difficulty getting loans due to lack of collateral, making it difficult to boost production. Therefore, Loc Troi's representative proposed a policy for farmers with production contracts linked to businesses to borrow more favorable capital because they already have output consumption contracts. Furthermore, banks should encourage farmers to open bank accounts to manage cash flow.

He also said that due to the sudden increase in rice export demand, the need for capital to invest in production has increased suddenly. According to calculations, by 2024, businesses need 15,000 billion of capital to invest in production, so banks are requested to provide capital based on large contracts and orders, along with longer loan terms.

Similarly, Mr. Ngo Minh Hien, General Director of Nam Can Seafood Import-Export Joint Stock Company (Ca Mau), said that the Government and SBV have directed the implementation of a VND 15,000 billion credit package to support seafood businesses’ products, but commercial banks are still "hesitant" and have not quickly deployed them, so the season to buy cheap shrimp has passed, and when they have capital, businesses have to buy at higher off-season prices. Therefore, this person requested banks to be flexible and provide timely capital support to businesses at the right time.

However, according to experts, to overcome difficulties for businesses, they need the support from the entire political system. Other agencies also need to participate in supporting businesses in terms of market promotion, finding orders... Banks must also actively promote their proactive role, further reducing loan interest rates and simplifying procedures to support customers.

Despite efforts to promote the flow of credit, Deputy Governor of the State Bank Dao Minh Tu also said "It is impossible to invest money with wrong purpse, leading to loss of capital and insecurity of credit institutions. Because the source of loans from banks is money mobilized from the people, which must be returned to the people. Therefore, banks can extend or postpone debt to support businesses, but it is not a grant or loan, but debt must still be recovered."