Banking & Finance

The disbursement of State budget capital remained sluggish in the first eight months of 2021 due to localities implementing social distancing measures, with total investment capital from the State budget falling 0.4 per cent year-on-year. In August alone, total investment capital from the State budget was down 7.1 per cent against July and 24.7 per cent year-on-year.

While there are no reports on data just at the moment, the devastation of Covid-19 has put Vietnam’s economy at risk of bad debts. The State Bank of Vietnam has therefore proposed developing a law on handling bad debts for submission to the National Assembly.

A range of maritime fees have been waived or reduced by up to 50 per cent to ease the burden of operating costs on vessels amid the pandemic, under Circular No. 74/2021 amending and supplementing a number of articles in Circular No. 261/2016 on maritime fees and charges promulgated by the Ministry of Finance. The Circular took effect from August 27.

Individual investors are considered to be disavantaged in the corporate bond market. Policy makers, managers, and experts are attempting to protect their interests and solve problems relating to risk. The liquidity of Vietnam’s corporate bond market is still quite small compared to other countries in the region.

Many businesses expect the State Bank of Vietnam to lower required reserve ratios, both to inject money into the economy and allow banks to have more capital and less capital costs so they can cut lending rates.

Rice enterprises in the Mekong Delta are facing many difficulties from the impact of the pandemic. The banking sector will therefore introduce solutions such as expanding and increasing credit limits for rice purchasing in order to remove the difficulties and avoid disruptions to the rice supply chain.