Small- and medium-sized enterprises (SMEs) have been highly conducive to economic development in Viet Nam as they significantly contribute to job creation, export promotion, growth generation and poverty reduction. However, despite accounting for some 98 per cent of the country’s enterprises, SMEs’ performance is still constrained by many factors, including both “internal capacity” and “unfriendly external factors”, such as shortage of qualified human resources and little access to technology, besides administrative red-tapism. Among the detrimental external factors, lack of credit accessibility is seen as the major obstacle to the sustainable development of SMEs. Therefore, one of the most important measures to support SMEs is to improve their access to credit. In an economy like Viet Nam whose financial system relies heavily on banks, access to credit is even more critical. Vo Tri Thanh In fact, Viet Nam has made great efforts in this regard, and … [Read more...] about SMEs’ access to credit: Better, but not enough
Bankruptcy 7 years credit report
Vietnam credit set to grow 10 pct y/y in 2014: newspaper
Vietnam's credit extension is expected to pick up pace over the rest of the year to reach growth of 10 percent from 2013 levels, though still below the government target of 12-14 percent, a local newspaper reported on Tuesday. The forecast was given by State Bank of Vietnam Deputy Governor Nguyen Thi Hong, who said she hoped actual credit growth would exceed 10 percent, the Vietnam News daily said. Achieving that forecast, however, would require a sharp pickup in the speed of credit growth in the last four months of 2014. The report said loans had risen by 4.5 percent in August from the end of last year. The central bank wants to boost lending to stimulate an economy propped up by manufacturing and exports, but constrained by bad debt and weak spending. Bankruptcies remain rife and many Vietnamese do not qualify for loans or are turned off by prohibitively high interest rates. Slower lending could affect Vietnam's economic growth rate, which has been targeted at 5.8 percent for 2014. … [Read more...] about Vietnam credit set to grow 10 pct y/y in 2014: newspaper
Steelmakers face bankruptcy
HA NOI — The Viet Nam Steel Association has forecast that a significant number of steel firms will shut down next year due to insufficient investment. Firms using out-of-date technologies and with small capacities would be among those facing the chop, the association said. Only a small number of steel producers use modern technology, nearly 30 per cent applying old mechanisms while 40 per cent manage to sit the fence. Association vice chairman Dinh Huy Tam said that steel consumption was anticipated to surge by only 4 per cent next year, a much lower figure compared to previous years. "It will cause steel firms a lot of potential trouble," Tam said. He added that steel consumption in the first nine months of this year had decreased over the same period last year and that the decline was expected to continue. Although many steel plants currently run at half capacity, most have retained large volumes of stock. Tam said that many producers had roughly 500,000 tonnes of steel in … [Read more...] about Steelmakers face bankruptcy
VN economy facing myriad difficulties: report
The Vietnamese economy is still facing a myriad of challenges, ranging from the large amount of nonperforming debts to the rising number of bankrupt businesses, the government and the Committee of Economic Affairs reported at the National Assembly's fifth session on Monday. "Although the socio-economic situation posted certain positive signs in the first four months, its development remains slow and unsustainable," Deputy Prime Minister Nguyen Xuan Phuc said to begin the government's report. The economy is still under pressure of high inflation and vulnerable to macro-economic instability, while the lending interest rates remain out of borrowers' reach, the report said. Credit growth lagged far behind the 12 percent a year target, and the rate of nonperforming loans remained as high as 7.8 percent by the end of last year, according to figures from the State Bank of Vietnam. The gold market management system has also failed to mobilize gold from the public to pump into the … [Read more...] about VN economy facing myriad difficulties: report
Japan to give US$7.7 billion loan guarantee
Japan's government plans to guarantee about 700 billion yen (US$7.7 billion) in loans and other funds provided by financial institutions to keep Japan Airlines Corp. afloat, the Nikkei business daily reported on December 6. The plan will be funded through an extra budget for the current fiscal year to next March, which is expected to be compiled this week, Nikkei said. The plan is aimed at keeping JAL from having to suspend scheduled flights due to a shortage of operating funds, Nikkei said. Debt-laden JAL has warned it faces bankruptcy unless it undergoes a major restructuring to cut costs, and is seeking a capital injection from a state-backed fund on top of any capital from American Airlines or Delta Air Lines. Nikkei said the loan-guarantee scheme will cover possible investments from financial institutions in the airline, and the support measure will enable them to provide necessary funding for JAL on short notice. Standard & Poor's cut JAL's corporate credit … [Read more...] about Japan to give US$7.7 billion loan guarantee