Opportunity to access 35 billion USD of working capital for Vietnamese enterprises
The program aims to boost the competitiveness of Vietnamese enterprises. With a grant of 5 million Swiss francs from SECO until 2029, this phase aims to help more than half a million Vietnamese small and medium-sized enterprises (SMEs) access about 35 billion USD in working capital.
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| Overview of the kick-off workshop of phase 2 of the Vietnam Supply Chain Funding Program |
Vietnam is one of the world's most open economies, with about half of its gross domestic product and one in two jobs dependent directly or indirectly on exports.
However, Vietnamese suppliers and exporters are facing difficulties in working capital due to long payment periods, often 30 to 60 days after delivery. This limits their ability to take on large orders and develop new business relationships.
According to a World Bank survey, by 2023, less than 20% of Vietnamese enterprises will participate in the global value chain.
Better access to supply chain finance can address working capital constraints by converting receivables and inventory into cash, while helping businesses reduce their borrowing costs.
This accelerates trade cycles and strengthens links with global value chains. Capital is also freed up for other productive purposes, such as investment in research and development, new technology and skills.
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| Mr. Thomas Gass, Ambassador Extraordinary and Plenipotentiary of the Swiss Confederation to Vietnam |
Mr. Thomas Gass, Ambassador Extraordinary and Plenipotentiary of the Swiss Confederation to Vietnam said, “ With the ambition to create breakthrough changes for Vietnam, the supply chain finance program will support businesses, especially small and medium enterprises, to access working capital .”
“ To achieve this goal, we will continue to work with government partners to adjust regulations to create a more favorable environment for supply chain financial services,” Mr. Thomas Gass affirmed.
Commercial banks and non-bank financial institutions will be able to tailor services to the needs of businesses of all sizes and sectors. This financial support will not only promote business development but also contribute to the goal of making Vietnam a high-income country by 2045, while creating more quality jobs and sustainable supply chains ."
500,000 Vietnamese businesses are supported
Launched in 2018 with support from SECO, IFC’s Vietnam Supply Chain Finance Program aims to address persistent market barriers that hinder the development of supply chain finance.
The program focuses on three main aspects: Promoting an enabling environment for chain finance, enhancing the capacity of financial institutions, and stimulating market demand and awareness.
Over the past five years, the program has contributed to improving regulations on secured financing of movable assets, advising on the development of supply chain finance strategies for four banks, and supporting up to $33 billion in receivables and inventory-based financing for 500,000 small and medium-sized enterprises.
Speaking at the launching ceremony, Mr. Nguyen Ngoc Canh - Deputy Governor of the State Bank of Vietnam said: The Supply Chain Finance Program Phase 1 has been implemented by IFC from 2019-2024 and achieved some positive results to improve the competitiveness and access to financial solutions of micro, small and medium enterprises in the production supply chain.
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| Mr. Nguyen Ngoc Canh - Deputy Governor of the State Bank of Vietnam |
Based on the remarkable results from phase 1, the State Bank of Vietnam has acknowledged and appreciated the fact that IFC and SECO will continue to develop and implement the Supply Chain Finance Program phase 2 expected from 2025-2030.
This program will continue to support Vietnam in enhancing the development of the supply chain finance market, focusing on supporting state management agencies such as the State Bank, the Ministry of Justice, the Supreme Court and other relevant agencies...
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| Swiss Ambassador to Vietnam Thomas Grass (left) and IFC Country Director Thomas Jacobs sign the Phase 2 Cooperation Agreement of the Vietnam Supply Chain Finance Program |
The State Bank of Vietnam leader said that the Program will also support capacity building in supply chain finance for banks, companies with supply chain finance trading platforms, businesses, suppliers, etc. and enhance the development of green supply chain finance for domestic Small and Medium Enterprises with higher competitiveness.
“ The State Bank of Vietnam, in collaboration with IFC and SECO, will continue to review and adjust regulations to create a more favorable environment for supply chain finance. This includes improving lending rules via e-finance platforms and encouraging financial institutions to diversify their products, thereby improving access to credit for small and medium-sized enterprises, ” Deputy Governor Nguyen Ngoc Canh affirmed.
In the second phase, which will last for the next five years, IFC and SECO will focus on building a stronger legal and regulatory framework to strengthen the supply chain finance market in Vietnam. The program will enhance the capacity of lending institutions to provide comprehensive supply chain finance solutions to small and medium-sized enterprises. At the same time, it will prioritize enhancing the knowledge and capacity of both local buyers and suppliers to use supply chain finance, promoting the development of the supply chain finance market in Vietnam.
“ Trade plays a key role in Vietnam’s economic development, especially in its goal of becoming a high-income economy by 2045. IFC is pleased to continue working with SECO and local banks to develop the supply chain finance market, a key part of the financing ecosystem for small and medium-sized enterprises ,” said Thomas Jacobs, IFC Country Manager for Vietnam, Cambodia and Lao PDR.
| The Swiss State Secretariat for Economic Affairs (SECO) Country Programme 2025-2028 focuses on supporting Vietnam to become a resilient high-income economy. Through targeted interventions in trade, innovation, public and private finance, and sustainable urbanization, Switzerland continues to support Vietnam in building a resilient, inclusive and sustainable economy. |
Source: https://congthuong.vn/thuy-si-tai-tro-5-trieu-franc-cho-chuoi-cung-ung-giai-doan-2-378669.html
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