This is the confirmation by Mr Dao Minh Tu, Deputy Governor of the State Bank of Vietnam (SBV), in an exclusive interview granted to Vietnam Business Forum on effective investment attraction measures for the Northwest – a promising but untapped land. Nguyet Tham reports.What would you say about effectiveness of credit capital performance in the Northwest in the past time?
The Northwest is still an extremely difficult area of the country, with 43 out of 62 poorest districts in the country. The poverty rate was up to 25.6 percent in 2013. In response to the Party and State policies, the banking sector has boosted credit to meet capital needs for socio-economic development and social security in the region while promoting its potential and advantages like forestry, mining and hydropower.
Outstanding credit in the Northwest has kept going up quite high in the past years. As of the end of 2014, total outstanding loans valued VND147,255 billion, an increase of 14.46 percent over 2013 and higher than the national average. In addition to loan programmes for agricultural and rural development, the banking system has actively provided funds for key projects in the region like Lai Chau hydropower project, Son La hydropower project, Noi Bai – Lao Cai Highway, thus considerably contributing to economic restructuring and socioeconomic development of the region.
Regarding policy-guided credit, as of November 30, 2014, the total outstanding loans of the Vietnam Bank for Social Policies (VBSP) of the Northwest valued VND21,529 billion, accounting for more than 16 percent of total outstanding loans of VBSP, which now has more than million customers in the region. After more than 10 years of operation in the Northwest, VBSP has helped over 466,000 households out of poverty and 1.7 million people get employed from its credit programmes. The bank also supported more than 260,000 students with credits to continue their education and built over 552,000 clean water and environmental hygiene works in the region.
State-funded credit programmes have gradually helped alleviate hunger and poverty, raise living standards and ensure social security, and upgrade technical infrastructure and rural areas.
Could you please talk about credit orientations of the banking sector and social security activities in the future to support socioeconomic development of the Northwest region?
In the coming time, based on Resolution No. 37-NQ/TW of the Politburo (9th tenure) and Conclusion No. 26-KL/TW dated August 2, 2012 of the Central Steering Committee on socioeconomic development, national defence and security guarantee in the upland and mountainous region until 2020, to promote the socioeconomic development of the Northwest, the State Bank of Vietnam (SBV) continues to direct credit institutions:
– Speed up credit investment for major projects in the Northwest and other key projects to generate broad ripple effects on strong economic restructuring;
– Prioritise loans for agricultural and rural development in accordance with Decree 41/2010/ND-CP, especially for the development of advantageous livestock and crops in the region; integrate the agricultural and rural development lending with national target programmes for the cause of new countryside development in the region;
– Increase lending for the poor and policy-benefited people to eradicate hunger and reduce poverty, and gradually improve the livelihood of people in the region; integrate credit policies with other social security guarantee programmes in the region.
– Closely work with the Steering Committee for the Northwest and local authorities to deploy bank-enterprise connecting programmes to extricate difficulties and create favourable conditions for businesses and citizens to access bank credits for production and business development.
As for social security work, for many years, in response to Party and State policies on support of rapid and sustainable poverty reduction, in addition to credit operations, the banking industry – with its highest capability and responsibility – is always at the forefront of financing social security works across the country, particularly poorer regions like the Northwest, the Central Highlands and the Southwest. In 2013, through the Northwest Investment Promotion Conference held in Tuyen Quang province, the SBV encouraged commercial banks to finance nearly VND455 billion for the region. In 2014, in the face of tough conditions, banks still funded VND333 billion for social security works in the region.
In the coming time, to promote the spirit of traditional mutual affinity and high social responsibility, the banking sector will continue to actively engage in social security activities across the country in general and in the Northwest in particular. Social security projects and programmes will focus on building houses for the poor, boarding schools and health centres to gradually improve education and medical infrastructure and living conditions for local people, especially the poor and ethnic minorities in remote areas in the Northwest.
In fact, despite its rich potential, the Northwest is not really an attractive destination for domestic and international investors. What measures are needed to attract more investment capital for the Northwest?
Indeed, the Northwest has a lot of potential and advantages for mining, tourism and hydropower but it is still quite poor in relation to other regions in the country: Difficult transportation, low income of people, limited high-level human resources, severe weather conditions and underdeveloped goods and monetary markets. These are obstacles to investment attraction into the Northwest. In order to attract more investment capital into the Northwest, it is necessary to build comprehensive development plans for the Northwest, focusing on the following contents:
-Accelerating the development of infrastructure and transportation system to smoothen the connectivity of the Northwest with other economic regions;
-The State should focus on key investments projects to create development breakthroughs and encourage investors to boost investment in the Northwest;
-Developing and attracting high-quality human resources;
-Introducing clear, practical master plans with suitable roadmaps based on available resources;
-The Central Government must have very specific support policies and mechanisms for this region and its localities. These policies must be based on economic and social conditions, customs, practices, advantages and disadvantages. I would like to emphasise that we have already had many specific support policies and mechanisms for the Northwest but we still need specific and feasible policies to build up the confidence of domestic and foreign investors.
Apart from investment capital, the coordination of ministries and branches has important roles in the Northwest development. What do you think about this?
Đăng ký: VietNam News
