Financing high-tech agriculture

The government has decided to provide a credit package worth VND100 trillion to boost the country’s high-tech agriculture

High-tech agriculture projects now have access to preferential credit

One of the first beneficiaries of the funds is a clean chicken egg production project - the DTK Phu Tho - in Phu Tho Province, which will get VND600 billion from the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank).

DTK Phu Tho is the first facility of its kind in Vietnam, applying chicken farming technology from Japan, the US and Israel to produce 178 million safe eggs per year. Vietcombank Chairman Nghiem Xuan Thanh said this is a new trend of investment in large-scale, high-tech agriculture.

Even before the Prime Minister decided on the VND100-trillion package, commercial banks had already invested about VND300 billion in high-tech agricultural businesses at interest rates 0.5-1.5 percent lower than standard market ones.

At a regular meeting of the government in February, leaders of the State Bank of Vietnam (SBV) and the Ministry of Agriculture and Rural Development proposed solutions to remove obstacles in high-tech agriculture development, especially in the disbursement of the VND100-trillion credit package. Minister of Agriculture and Rural Development Nguyen Xuan Cuong said he hopes the banks will provide the credit at interest rates 0.5-1.5 percent lower than usual. The ministry and the SBV will review the use of loans to existing beneficiaries of high-tech agriculture capital in order to learn from their experience and efficiently realize the VND100-trillion package.

According to SBV Governor Le Minh Hung, many banks are willing to participate in the VND100-trillion credit program, including the Lien Viet Post Joint Stock Commercial Bank (LienVietPostBank), which has committed to providing VND10 trillion for the program, and others. The SBV and commercial banks met recently to discuss the program’s implementation.

The banks have agreed to join the program by providing preferential credit for feasible high-tech agricultural projects. One of the issues discussed was the importance of improving the guidelines for granting property ownership certificates related to agricultural land, such as greenhouses, as a basis for credit provision and reception.

The Governor of the State Bank of Vietnam, Le Minh Hung, said it is important to have detailed assessments and forecasts on

the high-tech agricultural product market so that the banking sector can efficiently implement credit programs. This is a new field that could be risky for both banks and businesses, he cautioned.