Not only asserting its leadership in traffic, industrial park infrastructure, and residential and commercial construction in northern Bac Giang province, Truong Loc Construction Investment and Trading Joint Stock Company proves its capacity in planting forests and processing forest products. This business area creates many jobs for local people and helps improve living standards.
In spite of being a newly established company, Truong Loc Construction Investment and Trading Joint Stock Company has quickly affirmed its name with important projects in Bac Giang and neighbouring provinces thanks to its experienced, capable and creative employees. The company has undertaken many truck-road and border patrol road construction projects, like border patrol road in Cao Bang province, National Road 4B in Lang Son province, roads on Hon Doc Island in Kien Giang province, Pac Khuong Road in Binh Gia district, Lang Son province, and Vi Deo Ca Street in Huu Lung district, Lang Son province.
Traffic construction is a major strength and a driving force for the high business growth of the company. However, to expand its business scope and develop sustainably, the company’s management decided to choose forestation as a future development strategy. With capital raised from its construction business and mining, Truong Loc has grown forests on nearly 1,000 hectares of land in Luc Ngan and Yen The districts (Bac Giang province). The company is establishing a forest cover project in Dinh Lap district, Lang Son province after it obtained a licence to plant trees on 2,300 hectares from the provincial People’s Committee. The company’s leaders also continue appraising soil conditions in north-western provinces like Yen Bai, Lao Cai and Son La to enlarge its forestation projects. Together with carrying out forestation projects, the firm also plans to build forest product processing facilities of the highest economic efficiency.
Mr Hoang Quang Huyen, General Director of Truong Loc Construction Investment and Trading Joint Stock Company, said: At present, the company is quite successful in traffic works, construction and trading fields, which generate large revenues for Truong Loc. To take on larger projects, Truong Loc needs a large amount of capital. For the time being, the company is mainly relying on its own capital and borrowing from some commercial banks, but this channel is relatively hard to access. “Borrowing terms are not very long, usually five years - not enough for a cycle of forest development. Interest rates are relatively high and volatile, leading to ineffective capital employment. Besides, bank loans cannot exceed 50 percent of total investment capital,” he added.
One of the prioritised fields and beneficiaries for Asian Development Bank (ADB)’s concessional loans is private small and medium-sized enterprises operating in the field of agriculture. Credit funds will support the development of pro-environment agricultural sectors like forestation, wood processing, agricultural and seafood production, processing and exportation; innovative projects and business initiatives that provide jobs for local people or market agricultural products for farmers. However, according to Mr Huyen, that is the policy only. Many companies satisfying such conditions still have difficulty accessing capital from banks, especially foreign concessional capital like ADB loans. Many companies have tried exhaustively to approach such loans but they are still unsuccessful.
Also according to Mr Huyen, if his company can access ADB loans, it will undoubtedly create new breakthroughs in business, especially in reforestation and forest product processing. He also hoped ADB would expand the criteria, subjects and fields of priority lending for the private business sector. ADB should create an easy and simple corridor for companies to approach its capital sources.
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