Support policies brought to life

Policies come into practice

On August 16, the first three enterprises in Ho Chi Minh City were given loans by the Vietnam Bank for Social Policies (VBSP), Ho Chi Minh City branch, according to Resolution 68/NQ-CP of the Government on the implementation of a number of policies to support employees and employers facing difficulties due to the Covid-19 pandemic with a total amount of nearly VND1.14 billion to pay workers' wages.

They are Viet Fun Travel Co., Ltd with an amount of VND132.6 million to cover severance pay for 10 employees, Vi Nam Viet Production Trading Corporation (Vinavit Corp) with a loan amount of VND517.65 million to pay for 145 employees and Kingscross Restaurant Co., Ltd. is given VND486.2 million to pay for 55 employees.

According to the Bank for Social Policies, as of August 17, there were 51 branches in provinces and cities disbursing 267 employers with an amount of nearly VND170 billion to pay wages for 48,737 employees.

The Covid-19 pandemic has severely affected the operations of businesses, the income of many workers has decreased and some lost their jobs.

Therefore, creating favorable conditions for businesses to access preferential loan packages with 0% interest rates and no need for collateral have helped businesses restore production and business, and at the same time ensured income and stabilized the life of workers.

At the same time, reducing loan interest rates is one of the practical solutions to support businesses facing difficulties due to the Covid-19 pandemic.

Truong Chi Thien, General Director of Vinh Thanh Dat Food Joint Stock Company, said the company has just received a notice from the bank to reduce the interest rate for its working capital loan to 6.1%/year compared to 6.6%/year before. This interest rate at present is reasonable in the context of businesses being affected by the Covid-19 pandemic.

According to Thien, the food industry still performed well during the pandemic, but the difficulty was that the selling price did not increase while a series of input costs still inched up, affecting profits. Therefore, further reduction in loan interest will help businesses reduce financial costs.

Ho Chi Minh City is the most heavily affected locality in this fourth wave of the Covid-19 pandemic. In order to bring the above policy to life, Ho Chi Minh City Social Insurance has coordinated with departments, agencies and branches to advise the People's Committee of Ho Chi Minh City.

Phan Van Men, Director of Ho Chi Minh City Social Insurance, said that as of August 18, the unit has temporarily suspended collection to the retirement and survivorship fund for 116 businesses with more than 24,000 employees with a total amount of VND187.4 billion (the processing time is 1 working day from the date of receipt of complete documents).

In addition, Ho Chi Minh City Social Insurance has helped to reduce the contribution to the labor accident and occupational disease insurance fund from 0.5% to 0% for more than 2.3 million employees of 101,356 units with the amount of VND1,061 billion.

Need more transparency

Chu Tien Dung, Chairman of Ho Chi Minh City’s Business Association, said that in general, the Government's support packages have had an impact on businesses and some firms have been able to access them. However, there are still a number of regulations related to the conditions for support, which create barriers that make it difficult for businesses to access funds, so the absorption is not high.

Enterprises want this support package to greatly reduce administrative procedures, allowing enterprises to be automatically entitled to benefits without having to do any registration procedures, the management agencies are responsible for automatically considering and settling for enterprises, thus creating more favorable conditions for enterprises.

Le Hoang Chau, Chairman of Ho Chi Minh City Real Estate Association (HoREA), said that in order to increase resilience and overcome difficulties due to the impact of the pandemic, real estate businesses need to be supported to remove obstacles and inadequacies in terms of policy mechanisms and administrative procedures.

Accordingly, the HoREA recommends banks to consider reducing lending rates by about 2%/year for loans to businesses, including real estate enterprises, investors, and home loan customers. Consider not transferring debt groups for due loans; creating favorable conditions for businesses, including real estate enterprises, to access new loans to implement projects and continue to disburse capital for signed credit contracts.

Regarding tax policy and land use levy, HoREA requests the tax sector not to penalize the enterprise if it has not yet paid the land use levy payment past the deadline. Allowing to delay the payment of land use fees for commercial housing projects until the end of 2021.

Recently, the People's Committee of Ho Chi Minh City has also proposed many solutions to submit to the Government to maintain and stabilize production and safe supply chains to prevent the pandemic in the context that the number of cases per day is still very high.

In particular, the People's Committee of Ho Chi Minh City recommended the Government to direct the banking sector to support exemption and reduction of loan interest rates and new loans with higher credit limit s for businesses in the food industry to purchase and increase inventories for raw materials and auxiliary materials for production.

Speeding up the loan disbursement process; be proactive in capital sources associated with preferential credit programs and credit packages with preferential interest rates to supplement capital sources in order to purchase and reserve raw materials, supplies and goods for enterprises producing and distributing essential goods in order to stabilize the market and restore production after the pandemic is brought under control.