ADB to provide US$50 million loan to support SMEs

Friday, 2013-11-22 22:01:38
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At the signing ceremony (Credit: VNA)
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Nhan Dan Online – The Asian Development Bank (ADB) and the Vietnamese Government on November 22 signed an agreement for a US$50 million concessional loan to raise the competiveness of small and medium-sized enterprises (SMEs) in Vietnam.

The loan has a duration of 25 years with an annual interest rate of 2%.

The money will be used to support SME development efforts in Vietnam by streamlining business processes, improving access to finance, instituting programmes to support women-owned enterprises and creating a level playing field for private enterprise development.

The Vietnamese Government has assisted the development of SMEs for over a decade with a combination of landmark policy reforms, beginning with the approval of the Enterprise Law in 2000.

“While the Government made great efforts to enhance policy reforms to support the creation, survival and growth of SMEs, more needs to be done to foster a greater scale of SME development essentially required for the country to achieve more sustainable and inclusive growth,” said ADB Country Director for Vietnam Tomoyuki Kimura.

As a result, by the end of 2011, the number of registered enterprises in Vietnam has grown to some 550,000 – up from 14,500 in 2000 – with SMEs representing nearly 97% of the country’s total firms and 46% of its gross domestic product.

The domestic private sector accounted for 59% of total employment in 2011, up from 29% in 2000.

SMEs are now considered the key generators of employment and income and the drivers of growth and poverty reduction in the country.