In the first two months of the year, credit in Ho Chi Minh City decreased by 0.92%, compared to a decrease of 0.11% in the same period in 2023, an increase of 2.65% in 2022, and an increase of 0.57% in 2021. The decrease in credit in the first two months of the year was due to a sharp decrease in credit in January 2024 (decrease of 0.93%), which is related to the seasonal nature and characteristics of credit during the Lunar New Year, which usually fluctuates strongly due to predominantly short-term loans. However, when considering the current economic and social environment, Mr. Nguyen Duc Lenh – Deputy Director of the State Bank of Vietnam (SBV) Ho Chi Minh City branch, believes that credit in Ho Chi Minh City will maintain a growth trend in the near future, as it is influenced by the following positive factors:
The first factor is the technical factor. After a sharp decrease in January 2024 (decrease of 0.93%), credit in the city has shown positive growth. Although the growth rate is low (increase of 0.01%), if we consider the 16 working days of February 2024, credit maintains a positive growth rate, which is the foundation for starting the growth trend in the future.
The second factor is the credit and interest rate policy, which continues to be a good source of support for businesses and promotes economic growth. At the same time, low interest rates and a stable monetary market create favorable conditions for businesses and individuals to expand and develop production and business. Currently, low interest rates for loans, along with business support measures, are important factors driving credit expansion and growth over time.
The third factor is the positive developments in the economy, which create a favorable environment for credit growth. Specifically, the city’s economic growth in the first two months of the year has been maintained, tourism and service activities continue to grow, some industries have recovered and have many long-term orders, longer-term purchase contracts, and 100% capacity utilization; budget collection and trading on the markets have become more active…
However, credit growth and economic growth are closely interconnected. To expand credit and achieve effective growth, capital absorption and the development of markets (commodities, finance, real estate) as well as the efficient and purposeful use of borrowed capital by businesses are important. They not only promote production and business development, but also enhance the efficiency of the circulation and capital turnover in the entire economy.
