Government, banks and social insurance agencies help pandemic-hit business

06:00 | 17/08/2021 Society

(VEN) - The current or fourth wave of the Covid-19 pandemic in Vietnam has spread quickly to nearly 60 provinces and cities across the country, severely affecting economic activities. Enterprises nationwide need timely government support policies to survive difficulties and restore production and trade.

Support policies

The government issued preferential tax and capital policies, granting a 10-percent discount on retail electricity prices for businesses affected by the Covid-19 pandemic.

government banks and social insurance agencies help pandemic hit business
Enterprises apply important solutions to control the pandemic and maintain production

According to Government Decree 52/2021/ND-CP, enterprises can have their 2021 value-added tax (VAT), corporate income tax and state land rent payment deadlines extended. Provinces and cities have therefore extended the tax and land rent payment deadlines for businesses by three to five months. Tax authorities have also extended the deadline for submitting tax declarations and finalization documents for businesses in isolated and/or quarantined areas.

Le Bich Loan, Deputy Head of the Saigon High-Tech Park (SHTP) Authority, said the park instructed businesses to arrange temporary accommodation for workers to control the pandemic, maintain production and ensure social security. It also coordinated with the health sector to provide training in Covid-19 testing for medical staff of many companies in the SHTP, and estimated demand for Covid-19 vaccination of employees from park-based businesses.

Help from banks, insurance agencies

Most banks have agreed to cut lending rates for enterprises hard-hit by the pandemic from July until the end of this year, responding to a directive by the State Bank of Vietnam (SBV). The decision was reached at a July 11 meeting of 16 banks with the SBV.

The pandemic is having a negative impact on Vietnam’s economy and has forced many enterprises to suspend production or close entirely.

Following the State Bank’s direction, the Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) is continuing its one percent reduction in yearly lending interest rates for customers hardly hit by the pandemic while at the same time offering other preferential credit programs using the bank’s commercial capital. VietinBank’s financial support for businesses is expected to total over VND2 trillion in the second half of this year and more than VND6 trillion in 2021.

The Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) is reducing its loan interest rates for all customers until the end of 2021. This policy does not apply to loans already subject to preferential interest rates and loans for securities and real estate investment. Vietcombank’s support for its customers is expected to reach VND6.1 trillion in 2021.

Since last year, the Vietnam Technological and Commercial Joint Stock Bank (Techcombank) had continuously cut lending rates for priority sectors to below 4.5 percent per annum, and for essential economic sectors to about 6-7 percent per year. The bank is focusing its support in labor-intensive enterprises and those essential for the economy.

Pham Quoc Bao, Deputy Director of the SBV’s Dong Nai Province Branch, said that in August 2021, the SBV will continue to closely monitor the situation, directing credit institutions to promptly support businesses affected by the pandemic, focusing on rescheduling debt repayment, interest rate exemption and reduction.

The social insurance industry has reduced premiums related to occupational accidents and disease, suspended payment to retirement and survivorship funds, and provided training and helped maintain jobs. Immediately after receiving the guidance of the Vietnam Social Security, social insurance agencies of provinces and cities established steering committees to guide employers on implementing policies for their employees.

According to Pham Ngoc Hung, Vice Chair of the Ho Chi Minh City Business Association, the government and relevant sectors need to increase strong support solutions for businesses in order to help them survive the Covid-19 pandemic.

Thanh Thanh