Representatives from businesses in the Mekong Delta region have called for better access to credit sources allowing enterprises to renovate their technology.

They made the proposal at a November 25 conference on the use of bank credits to boost socio-economic development in the region, as part of the ongoing 2013 Mekong Delta Economic Cooperation Forum (MDEC Vinh Long 2013).

According to the State Bank of Vietnam, investments to the region have seen impressive growth.

As of the end of August, total outstanding loans at local credit institutes reached 301.6 trillion VND (14.17 billion USD), up 9.71 percent from the end of December 2012; higher than the average credit growth of the whole sector.

Bad debts in the region have been kept lower than the country’s average figure, accounting for only 3.38 percent of total outstanding loans.

However, the region faces capital shortages, as investments have met only 78 percent of the need for socio-economic development. Meanwhile, credit efficiency has been poor, with loans predominantly allocated to agriculture projects, leaving other sectors underfunded.

During the conference, participants pointed out difficulties of businesses to access capital sources. They also proposed a number of measures to enhance banks’ capacity of mobilising capital and lending.

They also sought ways to strengthen connectivity between bank credits and other capital sources, contributing to boosting local socio-economic development.

Representative from regional localities and enterprises also suggested that the central bank continue to implement preferential policies on middle and long-term loans for businesses with low interest rates, allowing firms to invest in technological upgrades and research for new products in highly competitive sectors.

It was also argued that credit institutions should expand their network to rural areas and diversify their credit services, enhancing capital efficiency to exploit advantages and potential of the region and creating momentum for the region to develop sustainably.-VNA