On December 22, 2020, at the headquarters of the State Bank of Vietnam (SBV), SBV Governor Nguyen Thi Hong, on behalf of the Government of Vietnam, and Mr. Andrew Jeffries, ADB Country Director for Vietnam, on behalf of the ADB, signed the Grant Agreement for the Project on “COVID-19 Relief for Women-Led Small and Medium-Sized Enterprises”.
Accordingly, the signed Grant Agreement worth USD 5 million funded by the Women Entrepreneurs Finance Initiative (We-Fi) to support Vietnamese women-led small and medium-sized enterprises (WSMEs) whose access to finance has been weakened because of the COVID-19 pandemic. The project is aimed to incentivize participating banks in Viet Nam to restructure existing loans or extend new loans to eligible enterprises, contributing to facilitating WSMEs to have more resources and time to recover their production and business operations, thereby helping those WSMEs to bring into full use their potentials to contribute to the socio-economic development.
The Project is designed and implemented on the base of and in accordance with the SBV’s mechanisms and policies of supporting credit for the COVID-19 affected businesses, including: (i) Circular No. 01/2020/TT-NHNN dated March 13, 2020 encouraging credit institutions to reschedule loans to support COVID-19 affected customers, and (ii) Directive No. 02/CT-NHNN dated March 31, 2020, which requires credit institutions to continue implementing measures of extending credit for priority fields, especially providing loans for the maintenance and recovery of the COVID-19 affected areas and sectors.
The owner of this Project is the SBV, while the implementing agencies are five commercial banks, namely the Asia Commercial Joint Stock Bank (ACB), the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV), Saigon-Hanoi Joint Stock Commercial Bank (SHB), Tien Phong Joint Stock Commercial Bank (TPBank), and Vietnam Prosperity Joint Stock Commercial Bank (VPBank). The Project is scheduled to be implemented from 2020 to 2022.
Governor Nguyen Thi Hong speaks at the Signing Ceremony
In her speech, Governor Nguyen Thi Hong said that, the outbreaks of the COVID-19 pandemic have caused serious impacts on the economies of many countries around the world, including Vietnam. The pandemic has made businesses, especially WSMEs, face a lot of hardships, including difficulties in accessing finance (including capital resources from commercial banks) to recover their production and business operations.
In this situation, following the instructions of the Government, the SBV has issued and implemented a series of credit support policies for the businesses affected by COVID-19, such as: Encouraging credit institutions to restructure loans to support COVID-19 affected customers; conducting credit expansion solutions to production and business activities, priority areas and sectors, especially providing loans to maintain and recover the areas and sectors affected by the COVID-19 pandemic. According to Governor Nguyen Thi Hong, in order to successfully implement these policies and solutions to support those businesses, the support from the international community has been extremely necessary.
Mr. Andrew Jeffries, ADB Country Director for Vietnam, speaks at the Signing Ceremony
Mr. Andrew Jeffries, ADB Country Director for Vietnam, shared that although Viet Nam has successfully managed the COVID-19 outbreaks, the supply chain disruptions, economic downturns in export markets, and declines in the tourism industry have slowed its economic growth. To recover and sustain the business operations, support to access critical financing is essential for small and medium enterprises (SMEs), especially WSMEs, which have been adversely affected by COVID-19.
Therefore, as a trusted partner of the Government of Viet Nam, the ADB has formulated this USD 5 million grant project, which will finance WSMEs to mitigate the negative impacts of the COVID-19 pandemic. Mr. Andrew Jeffries hoped the Project would be implemented successfully, helping WSMEs to improve their capabilities and financial accessibility to maintain and develop their production and business operations, contributing to Vietnam’s economic recovery and sustainable growth in the coming time.
On behalf of the participating banks, Ms. Ngo Thu Ha, SHB Deputy General Director, committed that the involved banks would try to implement the Project effectively, in compliance with the relevant regulations during the implementation process, making contributions together with the Project owner to implement the Project successfully.
Le Hang