Ho Chi Minh City is set to roll out a second COVID-19 aid package worth 12 trillion VND (517 million USD) exclusively for small and medium-sized enterprises (SMEs) (Photo: VNA) HCM City (VNS/VNA) –Ho Chi Minh City is set to roll out a second COVID-19 aid package worth 12trillion VND (517 million USD) exclusively for small and medium-sizedenterprises (SMEs).
Le Minh Tan, Director of thecity Department of Labour, Invalids and Social Affairs, said that preferentialloans would be offered to employers to maintain production, retain workers andward off bankruptcy with priority given to micro and small-sized enterprises.
“Unlike the previous packageunder the Government’s Resolution 12, the second package will provide SMEs witheasier access to preferential credit, and not require a 50 percent cut inpayroll or fall in revenues [to qualify].
“Instead, businesses can borrowto maintain their production and [retain] employees if their revenues declinedby just 20-30 percent from the fourth quarter of 2019.”
The package would involve theactive participation of commercial credit institutions, he said.
The city’s credit institutionshad loans outstanding of 2.38 quadrillion VND (102.5 billion USD) as of the endof August, an estimated 3.68 percent up for the year, the lowest rate in manyyears. But the State Bank of Vietnam (SBV) said cash is still being pumped intokey areas of the economy.
Short-term loans provided tothe city’s five priority sectors (agriculture and rural development, productionof goods for exports, small- and medium-sized enterprises, supportingindustries, and high-tech enterprises) were worth 176.26 trillion VND as of theend of August.
On the central bank’sinstructions to offer relief to pandemic-hit companies, credit institutionsgave 240,407 firms in the city loans worth 583.15 trillion VND.
As stipulated by the SBV, thebanks reduced interest rates, rolled over debts and did not classify overduedebts owed by affected businesses as bad.
Nguyen Hoang Minh, Deputy Directorof the SBV’s HCM City Branch, said 230,700 borrowers had so far benefited fromthese policies as of the end of June.
Interest rates had been cut onloans worth over 49.97 trillion VND given to nearly 17,420 borrowers, and newsoft loans worth more than 270.42 trillion VND were offered to over 44,600pandemic-hit customers.
In addition, around 168,670borrowers have had their loan payment deadlines extended, he said.
The banking industry wouldcontinue to focus on efforts to resolve challenges faced by businesses based onguidelines issued by the Government, the central bank and the city People’sCommittee, he added.
Speaking at a recent meeting, Chairmanof the municipal People’s Committee Nguyen Thanh Phong said the city wouldannounce specific policies to help enterprises and industries heavilyaffected such as travel, restaurants, hotels, and transport- andtourism-related services.
More than 21,000 citybusinesses have suspended operations and laid off a large number ofemployees, he said.
“The top priority is to helpbusinesses maintain production and avoid bankruptcy, and prevent moreworkers from losing jobs.”
Small and medium-sized enterprises,which account for 98 percent of all enterprises, have been seriouslyimpacted, he said.
Services, which account formore than 60 percent of the city’s economy, have been hit hardest, especiallytourism and accommodation.
Jobs protected
Tan said his departmentwould take whatever measures needed to safeguard people’s jobs andincomes.
More than 327,000 people werelaid off in the first half, he said.
Tourism and other services werethe hardest hit with some 4,400 enterprises being affected and 100,000-120,000jobs being lost.
To protect workers, thedepartment has set up working groups to support businesses and ensure employeesare treated in accordance with legal provisions, he said.
In March city authoritiesapproved a support package targeting poor families and 600,000 workers andteachers at private pre-schools who had lost their jobs.
Prime Minister Nguyen Xuan Phucearlier approved a relief package worth over 62 trillion VND (2.7 billionUSD) to benefit around 20 million people nation-wide, with a focus onworkers who lost jobs or incomes and businesses affected by the pandemic.
According to city authorities,90 percent of 8,400 enterprises facing difficulties are eligible for the 62trillion VND package./.
VNA
