City to provide interest free loans for infrastructure projects

Infrastructure projects in traffic, social housing and waste treatment in the city will be given 50-100 percent interest free loans as part of the city’s stimulation policy, said Mr. Diep Dung director general of the Ho Chi Minh City Finance and Investment Company (HFIC).

 
Traffic infrastructure projects will receive interest free loans from the Ho Chi Minh City Finance and Investment Company (Photo: SGGP)

Investors will receive assistance of 50-100 percent interest free loans on less than VND100 billion (US$4.8 million) projects for a period of seven years.

The 100 percent assistance will be for projects to build or upgrade theatres, cinemas of over 1,000 seats, gym and sports centers, schools, general hospitals, student dormitories, houses for workers and waste treatment systems.

The 50 percent assistance will be for projects to build wholesale markets, economic zones in border gate areas, commercial centers and supermarkets in Lao and Cambodia.

Mr. Dung said that the loan interest rate will be at an annual average rate of four commercial banks in the city, with added 1-2 percent for management fees.

Businesses should have legal and feasible projects and present clear and precise financial reports to obtain loans.

Small and medium businesses should contact professional consultants to set up their projects and complete related documents instead of doing themselves as at present.

Trang Trung Son, head of the economic division under the City Department of Planning and Investment, said that the above policy will be applicable for Vietnamese businesses and the City will not encourage project participation by foreign investors.

However, HFIC has other sources of capital with preferential interest rate for both domestic and joint venture businesses. One capital source is US$50 million from the World Bank and Euro 50 million from the French Development Agency.

In related news, the HCMC Waste Recycling Fund is also offering preferential loans to projects related to waste recycling.

The maximum loan will be VND7.5 billion ($360,000) per project for a period of seven years. Those wanting to access these loans can contact the fund headquarter at 63 Ly Tu Trong in District 1 of HCMC or dial (08)39151980.

By Nhung Nguyen – Translated by Hai Mien

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