The government of Vietnam on January 15 officially approved plans to start spending VND17 trillion, (US$1 billion) to support local companies to overcome the current economic slowdown.
The $1 billion fund, which is part of the government’s $6-billion financial stimulus package, will be used to subsidize as much as 4% of interest rates for 12-month loans that the companies will borrow from banks in 2009, the government said in a statement published on its Website.
The government said most of the companies which will be eligible for this plan, except those which are importers of non-essential goods or stock and financial investors.
In addition, the government will also consider to set up its funds to guarantee credits for enterprises which have registered capital of less than VND20 billion and staff of below 500 workers with fee of 0.5% annually, except for stock consulters and lottery game runners.
The MOF and the Vietnam Development Bank are expected to set up a VND200 billion credit-guarantee fund in this direction, the government said.
To effectively support the economy, the MOF said it has decided to allow individuals and companies to delay making payments for personal income and value added taxes, tariffs on exports and imports, and to halve the value added tax to 5% for coal, construction materials, mechanical, auto, and metal companies from next month.
The government also agreed to invest VND44.5 trillion worth of government bonds into key investment projects approved for this year and next, the Saigon Liberation newspaper said.
Prime Minister Nguyen Tan Dung has approved to provide VND3.8 trillion as handouts to the poor families during the upcoming traditional Lunar New Year holidays.
In December, the Vietnamese government announced to implement a $6 billion financial package to help the country overcome the current economic difficulties and achieve a 6.5% GDP growth in 2009. (www.chinhphu.vn, Youth)
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