Gov’t Issues New Decree on Support for Investment, Export Credit

The Government of Vietnam has issued the Decree 75/2011/ND-CP on State investment credit and export credit, which is to take effect on October 20, 2011.

 

The decree states that borrowing projects or contracts must be fruitful and solvent and the lending must include finance and debt payment appraisals from the Vietnam Development Bank (VDB).

 

The decree provides that borrowers, or project owners, must contribute at least 20 percent of the total investment capital to the project in addition to ensuring the remaining necessary funding.

 

The maximum loan to an investment project will be restricted to 70 percent of its total investment capital. Under the decree, maximum lending to an investment project may not exceed 15 percent of VDB's charter capital. In special cases that require larger loans than permitted, the Prime Minister will make a decision after reviewing proposals from the Ministry of Finance.

 

Regarding export credit, the maximum loan to an export or import contract is 85 percent of the total value of the contract. Maximum lending to an export-import contract may not exceed 15 percent of VDB's charter capital.