[6 August 2012] - The International Finance Corporation (IFC) is providing support to Vietnam to improve the competitiveness of Vietnam’s agribusiness sector by helping to facilitate more investment in the agri-logistics sector, reduce post-harvest losses and costs of compliance, and increase lending to agribusiness-related activities.
The overall goal of the program is to increase Vietnam’s agricultural sector competitiveness by increasing overall investment in and improve lending to this sector. This will involve working with commercial banks and financial institutions, asset managers and warehouse operators to enhance capacity regarding CMA/SMA financing, working with relevant government and industry bodies to improve the enabling environment for commodity collateralized lending and industry dialogue related to warehousing.
Specifically, the agribusiness program will aim to help modernize Vietnam’s warehouse industry by improving commodity collateralized financing or warehouse receipt financing, professionalizing warehousing and related services, increasing the usage of standards, and improving the enabling environment for agricultural commodity collateralization and warehouse licensing. This will involve working with committed partner banks and financial institutions, asset managers and warehouse operators to improve their capacity regarding collateralized commodity financing, working with relevant government and industry bodies to improve the enabling environment for commodity collateralized lending, licensing of warehouses and exporters, and industry dialogue related to warehousing.
Economica Vietnam, under a framework agreement with IFC, is supporting the implementation of a warehouse study in order to provide in-depth data, information and assessment of Vietnam’s agricultural warehousing and logistics sectors. The study will be used to identify and assess prospective program foci, for discussion with government and private sector partners, and as input to future project design in relation to a program and associated initiatives projects which seek to increase financing to the agricultural sector through commodity collateralization.
In addition, Economica Vietnam also support the corporation in conducting a survey of CMA/SMA and asset management practices for commodity collateralized financing in Vietnam. The survey is to understand banks’ current practices and identify gaps with international best practices for additional support.
The study and survey will be implemented in corporation with a team of international experts and will be finalized within Quarter IV of 2012.