Vietnam’s Economy Gears Up for Major Growth Opportunities

This is the sharing of Ms. Nguyen Thi Phuong Thao, Deputy Chairman of HDBank at the conference to implement the monetary policy management tasks for 2024, focusing on removing difficulties for production and business, promoting growth and macroeconomic stability, held on the morning of March 14. The conference was chaired by Prime Minister Pham Minh Chinh and Deputy Prime Minister Le Minh Khai.

Ms. Thao said: In the context of unprecedented fluctuations in the world, challenges of the domestic economy and society, we are excited and confident in the country’s achieved growth under the skillful leadership of the Government. At the end of 2023, with a GDP growth rate of over 5% and a GDP value of 430 billion USD, Vietnam became the 35th largest economy in the world.

With the close and resolute direction of the Prime Minister, the banking sector has made significant contributions to the country’s common achievements as the lifeblood of the economy, macroeconomic stability, inflation control, exchange rate stability, foreign exchange reserves, proactive monetary policy management, flexible contributing to national credit rating.

In 2024, despite the impact of the banking system, the banking industry continues to support businesses and people in overcoming difficulties, developing production and business activities, supporting economic development, and target to provide timely credit to enterprises and people to stimulate credit demand. However, the credit growth results of the banking industry in the first two months of the year are still low due to the reduced capital absorption capacity of businesses and the population.

Realize the credit growth target from the beginning of the year

With its sustainable development strategy, proactively and flexibly adapting to market conditions, promoting digital transformation and green growth, innovating thinking and continuous creativity, in 2023, HDBank proactively balances capital sources, complies with regulations to have a large margin for growth this year, along with low-interest policies and from early on, the whole system has implemented the credit growth target assigned by the State Bank of Vietnam, with the goal of providing timely capital for business development, stimulating credit demand. As a result, credit still grew positively in the first months of the year.

As of the end of February 2024, the total outstanding loans of HDBank reached 346,506 billion VND, a 2.71% increase over 2023, focusing on disbursing capital for processing and manufacturing industry nearly 5,000 billion VND; construction industry over 4,000 billion VND; transport and warehousing more than 5,000 billion VND; Agriculture and forestry nearly 4,000 billion VND; production outsourcing, household borrowing nearly 12,000 billion VND.

HDBank has implemented many credit programs implementing the orientation of the Government and the State Bank of Vietnam to develop the economy, ensuring the lives of businesses and people as well as continuing to revive the economy and society. For example:

HDBank always closely follows and promptly implements credit programs according to the direction of the Government and the State Bank of Vietnam, such as a 5,000 billion VND package focusing on disbursing for rice purchasing activities when the Mekong River Delta enters the peak harvest season according to Directive No. 10 of the Prime Minister recently issued. Continue to implement the 2,000 billion VND package and solutions to support gas stations to invest in the electronic invoice system according to the resolute direction of the Prime Minister this month.

Along with that, recently, HDBank has proactively and effectively implemented major programs and policies such as in implementing debt restructuring under Circular 02 of the State Bank of Vietnam, with a total outstanding debt balance being restructured loan term and maintaining the debt group amounting to 6,670 billion VND with 80 customers. As of the end of February 2024, there are still 3,650 billion VND with a total of 62 customers.

Responding to the call of the Governor of the State Bank of Vietnam and Chairman of the Ho Chi Minh City People’s Committee to open up credit sources, support businesses and people with a total credit limit of 50,000 billion VND. Up to now, more than 10,500 billion VND has been disbursed, supporting 1,600 enterprises. Preferences for retail chains, agro-rural chains; continue to strengthen the connection between banks and businesses; HD Saison sponsors consumer demand, supports workers in industrial parks nationwide, and has disbursed 10,000 billion VND for preferential interest rates.

HDBank has actively deployed loans on the app, flexible digital tools with eCredit, eDrawdown, eFactoring, eZyLoans products to help businesses access to the fastest capital source at the most cost savings. The 10,000 billion VND product package with 0% interest rate for the first month for new customers / or existing customers borrowing additionally for individual customers, business customers of salary vay and SME customers will be continued until March 31, 2024.

Simultaneously, HDBank cooperates with localities to strengthen propaganda against black credit, implement live-streaming activities accompanying the National Program of Quality Control and Assurance to support farmers, villages in promoting e-commerce and promoting and selling products.

It is viewed that there are still many challenges ahead, Ms. Nguyen Thi Phuong Thao believes that at this time Vietnam is standing before a great growth opportunity with long steps for the economy. Leaders of powerful countries in the world have visited Vietnam officially this year and the successful economic diplomacy of the Government has never been as successful. The international political and strong domestic situation is an opportunity for Vietnam. Let’s seize this opportunity, promote the ability to attract investment of the economy, especially private investment, through the turmoil, find solutions to infuse capital into the economy, this is also a great opportunity for the banking industry.

Credit growth accompanies policies of exemption, reduction, extension of taxes, fees to support businesses

Ms. Thao has proposed some suggestions, proposals as follows:

First, credit growth should be accompanied by financial policy consideration, exemption, reduction, extension of taxes, fees, and rent to support people, businesses, adjust the personal income tax rates to save people’s power and increase their spending.

Second, propose the Government’s Working Group, ministries, and local authorities together with the banking industry to resolutely implement measures to remove obstacles in procedures, permits for businesses to implement investment projects in the real estate sector, and business sector to create employment opportunities, thereby helping disburse credit.

Third, it is necessary to promptly restore confidence for the corporate bond market to develop alongside capital sources from banks for businesses, projects with long-term capital.

Fourth, support the agriculture, rural credit area, women, start-ups, and relax the regulations on secured assets to ensure the repayment sources of the loans.

“In 2024, HDBank is resolutely implementing the credit growth solutions true to the target. We are committed to always trust and respond positively to the programs of the Government and the State Bank of Vietnam to promptly meet the credit needs of the economy, continue to strengthen credit into priority sectors and economic growth drivers according to the Government’s policy, the Prime Minister”, Ms. Thao affirmed.