[25 Nov. 2015] —  State Bank of Viet Nam would further formulate policies to support efficient small- and medium-sized enterprises and those manufacturing and exporting products, Director of SBV's credit department Nguyen Dong Tien.

Seeing the significant role being played by small- and medium-sized enterprises (SMEs) in the economy, which account for 97 per cent of the existing enterprises, Viet Nam has already issued policies offering preferential loans to SMEs. Lending to SMEs accounts for roughly 25 per cent of the economy's total outstanding loans.

Dong said policies would be issued to direct capital flow to SMEs that are run efficiently and those directly producing or exporting goods. Preferential policies would especially be offered to businesses in support industries, agricultural and rural sectors, those applying hi-tech and those in remote areas.

Experts said more credit for SMEs would not only ensure efficiency, safety and sustainable development of credit institutions' operations, but also help SMEs to exploit resources for development.

At a recent interpellation, Minister of Planning and Investment Bui Quang Vinh said together with the amended laws on investment and enterprise, the ministry had proposed to the Government a new law on supporting SMEs to be put into consideration.

The legalisation of support to SMEs is expected to ensure stronger development of SMEs, which contribute 40 per cent of the country's gross domestic product and employ 51 per cent of labour.

Rising credit growth

Credit demands of businesses often rise towards the end of the year, offering opportunities to the banking sector to maintain the credit growth rate, and a target credit growth of 13 to 15 per cent for the whole year is now at hand.

Le Duc Tho, general director of Vietinbank, in a report published on Nhan Dan (the People) online newspaper said it was important to ensure the quality of credit.

Several analysts said the central bank might aim for higher credit growth for 2016, given the transparent economic recovery.

Tho cited National Assembly Deputy Tran Du Lich as saying that credit growth should be three times higher than the gross domestic product (GDP), or about 20 per cent next year.

The latest figures of the Ha Noi Statistics Department reveal that outstanding loans in the capital city total VND1.193 quadrillion (US$53.02 billion) in November, rising 1 per cent over the previous month and 18 per cent over last December. — VNS