Workshop on solutions to remove obstacles in accessing credit capital for collective economy

On the morning of April 23, the Vietnam Cooperative Alliance (VCA) in collaboration with the State Bank of Vietnam organized a national online workshop on solutions to remove obstacles in accessing credit capital for the collective economy.

Comrades: Cao Xuan Thu Van, President of Vietnam Cooperative Alliance; Dao Minh Tu, Permanent Deputy Governor of the State Bank of Vietnam co-chaired the workshop.

At Ninh Binh bridge, the workshop was attended by representatives of the Provincial Cooperative Union, a number of relevant departments, branches and units.

According to preliminary statistics, by the end of 2023, the country had 30,698 cooperatives, 137 cooperative unions and 71,500 cooperative groups. The number of newly established cooperatives in 2023 was 2,986 (an increase of 291 cooperatives, an increase of 10.8% compared to 2022), with an average of 250 newly established cooperatives/month.

In general, the performance indicators of cooperatives, cooperative unions and cooperative groups have increased compared to 2022, especially the scale of production. The trend of cooperation has also been expanded and put into practice.

In order to create a basic legal framework to support and encourage the development of collective economy and cooperatives, the Prime Minister has approved the Strategy for the development of collective economy and cooperatives for the period 2021-2030; Plan for the development of collective economy and cooperatives for the period 2021-2025... In addition, the State Bank has identified the collective economy sector in general and cooperatives in particular as one of the priority credit investment sectors for the banking sector, directing the implementation of many solutions to expand credit for this economic sector.

However, the State's support and incentive policies still have some shortcomings and limitations, and have not achieved the expected results. Some cooperatives have weak internal capacity, low operational efficiency; ineffective use of loan capital, misuse of loan capital, and long-term overdue debt.

In Ninh Binh, the Provincial Cooperative Union is currently participating in managing and operating capital from the National Employment Fund and the Provincial Cooperative Development Support Fund. By December 31, 2023, the Provincial Cooperative Union is managing 19 projects with a total capital of nearly VND 1.4 billion from the National Employment Fund and 69 projects with a total capital of VND 28.5 billion from the Provincial Cooperative Development Support Fund. In 2023 alone, it consulted on the development, appraisal of documents and disbursed 22 projects with a total capital of VND 9.85 billion. Coordinated with the Vietnam Cooperative Development Support Fund to support loan access documents for 2 cooperatives and 1 cooperative union. However, in reality, most cooperatives lack capital for production and business, cooperatives cannot access preferential loans from the State because they do not have collateral; and cooperatives violate the law due to lack of knowledge.

To ensure the goal of sustainable economic development, access and effective use of capital, the solutions mentioned at the workshop are: Completing the legal framework for supporting and developing the economic market in the coming period; building a core team of professionally trained staff with knowledge of economics, finance and management; localities continue to maintain and implement appropriate support policies that have been issued, and in cases where they are no longer appropriate, they must promptly amend and replace them; promulgate policies and allocate resources to support the development of the economic market and cooperatives, without waiting or relying on them; research and develop specific mechanisms in mobilizing and using the State budget to support cooperatives and ensuring resources to implement policies; enhance the role of representative organizations, the core of which is the Vietnam Cooperative Alliance at all levels; further promote the effectiveness of Cooperative Development Support Funds, resources from cooperative members themselves, and social resources, etc.

At the workshop, delegates also discussed issues related to mechanisms, policies, and procedures for accessing loans; the current situation, advantages, and difficulties in accessing credit capital. At the same time, they proposed and recommended solutions to remove obstacles when accessing credit capital of cooperatives. Some delegates commented: Farmers' access to bank capital still faces many difficulties due to collateral requirements; credit access procedures are still complicated; credit in the agricultural chain has not been widely applied; the ability to handle credit risks is low, not yet linked to Agricultural Insurance...

In his concluding remarks at the workshop, Comrade Cao Xuan Thu Van, Chairman of the Vietnam Cooperative Alliance, fully accepted the opinions of units, sectors, localities, and experts; at the same time, he pointed out the limitations of the Cooperative Alliances and cooperatives, such as the lack of independent accounting and auditing systems, lack of production processes and product outputs, and the lack of specific application of policies in life, etc., which need to be promptly revised. He also hoped that banks would pay attention to investing in and supporting the pilot credit package specifically for cooperatives in the coming time in order to soon complete the goal of having 20% of Vietnam's population become members of cooperatives by 2045.

Lan Anh - Hoang Hiep

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