Delta SMEs urged to use idle capital

Small – and medium-sized enterprises in the Cuu Long (Mekong) Delta provinces that have had difficulty accessing bank loans should make use of their idle capital, business leaders have recommended.

“The situation for recovery after the financial crisis is not easy for every SME,” Nguyen Huu De, deputy director of Can Tho City’s Viet Nam Chamber of Commerce and Industry (VCCI) told the conference last Friday.

De said SMEs accounted for 90 per cent of total businesses in the Delta region.

Other experts at the conference also encouraged SMEs in the region to use idle capital to re-invest in production.

Bui Van, consultant for the financial channel FBNC, said most SMEs were unaware of how to use all capital sources for production because they had not been doing business for a long time.

Dr Le Tham Duong of the HCM City Banking University proposed that banks in the region create more credit forms rather than just guaranteed loans.

“In my research, only one-third of SMEs can access capital from bank loans, and the remaining two-thirds have to find other sources, even with higher interest rates,” he said.

Duong said SMEs could gain more trust from banks by improving their production and management capacity.

They should also demonstrate their need for owning advanced technology and equipment, he added.

However, Vo Hung Dung, director of the VCCI branch in Can Tho Province, told Viet Nam News that SMEs should not be blamed for difficulties in accessing capital from loans because the amount of available capital loaned by banks was taken up mostly by large companies.

The conference was co-held by the laisuat.vn economic information channel and Can Tho VCCI chapter. — VNS

Tags: Vietnam companies, Vietnam enterprises, Vietnam SMEs