According to the Institute for Training and Research of BIDV, lending to industrial parks and export processing zones has been growing rapidly in recent years. Only during the period from September 2020 to November 2023, the outstanding loan for industrial parks and export processing zones increased from 17,900 billion VND to 67,600 billion VND.
Dr. Can Van Luc, BIDV’s Chief Economist, said that the credit growth rate in industrial parks is very fast compared to the overall credit growth rate of the economy and the credit growth rate of the real estate business. Especially in recent months, lending to this area has increased by an additional 11,000 billion VND. On average, each month (from August to November 2023), banks have provided 3,000-4,000 billion VND in loans to infrastructure construction projects and production and business enterprises in industrial parks. Although the total outstanding balance is not large, it accounts for about 6.6% of the total outstanding loans in the real estate business sector.
According to Circular 22/2023/TT-NHNN amending and supplementing some provisions of Circular 41/2016/TT-NHNN on capital adequacy ratios for banks, foreign bank branches, credit risk coefficients applied to dedicated credit assets in the form of real estate business project financing in industrial parks is only 160%, while the credit risk coefficient applied to dedicated credit assets in the form of real estate business project financing is 200%.
According to experts, reducing the risk coefficient for real estate loans in industrial parks will allow more capital to flow into this sector.
Based on observations in the market, the demand for capital in industrial parks and export processing zones has increased due to the well-established infrastructure within these areas, making it easier for businesses to access bank loans for production and business activities. Specifically, by the end of 2023, the credit growth rate in industrial parks in Ho Chi Minh City is expected to be over 10.5% compared to 2022. The connection between banks and businesses has contributed more than 4,600 billion VND to businesses operating in industrial parks and export processing zones.
Reducing the risk coefficient for loans in industrial parks to 160%
Many banks have also introduced credit programs tailored to the capital needs of businesses in industrial parks. For example, Agribank offers preferential loans for investment projects in the construction and infrastructure business sector, investment in construction of factories and warehouses for rent with a fixed medium- and long-term interest rate of 7.3% per year for the first two years. VietinBank has a 15,000 billion VND loan package for industrial support businesses and construction businesses. TPBank, VietBank, and Techcombank also provide preferential loans for plastic industry businesses with interest rates lower than conventional loans, ranging from 0.5-1.5% per year.
Airbus recently forecasted that the Asia-Pacific region will need about 400 wide-body cargo aircraft in the next 20 years, including new and converted aircraft. The opening of the Airbus and ST Engineering C295 maintenance center – the type of aircraft used by the Vietnam Air Force will create many investment opportunities in the region. With the trend of investment shift within the region, economic experts believe that the number of projects will increase sharply along with the emergence of large-scale projects, which is one of the factors driving credit institutions to expand their business in the future. This is also a motivation for localities to promote the implementation of investment support programs, in which banks have the opportunity to expand their business.
This is consistent with the results of the Forecasting Statistics Department’s survey conducted in the fourth quarter of 2023, in which credit institutions all believed that the demand for industrial development and construction loans will have a strong growth rate. In the early months of 2024, the economic sectors expected to drive credit growth include wholesale and retail, import and export, beverage production, and construction.
