Ho Chi Minh City to pay interest on agriculture production loans

The Ho Chi Minh City (HCMC) People's Committee recently issued guidance on implementation of a plan under which the city would fund the interest on loans taken out by organizations and individuals with feasible agricultural business projects.

High agricultural growth

In 2017, HCMC reached an agricultural, forestry and fishery production value of almost VND19.48 trillion, up 6.3 percent from the 2016 growth of 5.8 percent. Production value reached almost VND1.93 trillion in the first two months of 2018, up 6.5 percent from the same time in 2017. Of this, cultivation reached VND472 billion (up 5.7 percent), animal husbandry produced VND865 billion (up 4.3 percent), and fisheries reached VND468 billion (up 10.2 percent).

High technology has been applied in vegetable and fruit production on 389.8 hectares of land in the city, nearly quadruple that in 2016 (101ha).

Interest-based assistance

According to the HCMC Department of Agriculture and Rural Development, the city is home to 1,200 agricultural enterprises with an average capital of VND27.6 billion, VND9 billion lower than the city’s average. City-based agricultural enterprises have contributed 14.7 percent to the city’s agricultural production value.

The HCMC People’s Committee recently issued a regulation guiding the implementation of HCMC People’s Council Resolution 10/2017 on promoting agricultural restructuring in 2017-2020, under which organizations and individuals with feasible business projects approved by the banks for loans can have their loan interest financed by the city.

Supported interest will be calculated based on the average annual deposit interest rate for 12-month deposits at four commercial banks in the city, including the Vietnam Bank for Agriculture and Rural Development (AgriBank), Bank for Investment and Development of Vietnam (BIDV), Bank for Foreign Trade of Vietnam (Vietcombank), and Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), plus two percent. Projects for capital construction, purchase of machinery and equipment for agricultural production, rural occupation development, farm produce processing, swallow nest harvest according to approved plans, aquaculture, replacing inefficient dairies with higher productivity ones, seed production, and certified high-tech agricultural production can have all of their loan interest funded by the city.

Meanwhile, orchid, bonsai, ornamental fish, dairy and meat cattle production, and aquaculture projects can have 80 percent of their loan interest financed by the city, while projects with contracts on farm produce trading and production, projects purchasing materials to develop rural occupations, projects repairing and equipping fishing boats of less than 400HP, and projects for cattle and poultry feed production and ecotourism development can have 60 percent of their loan interest supported by the city.