Workers at the Vietnam Precision Industrial No.1 Co., Ltd in Vinh Phuc Province. — VNA/VNS Photo Tran Viet

HCM City will lend up to VND200 billion (US$8.8 million) without interest to viable supporting industry projects.

A regulation issued recently by the municipal People’s Committee says the time limit for the interest-free loans will be seven years. The loans will be funded by the city’s budget.

For businesses that require loans of more than VND200 billion or want to extend their interest-free duration, authorities will take decisions on a case-by-case basis.

The regulation aims to encourage businesses and economic institutions to invest in modern technology, creating products that can replace those that are currently being imported.

This will help create value-added products and boost supporting industry and the industrial sector.

To be approved for the interest-free loans, the projects will have to be in sync with the city’s planning and investment policies.

The city will bear the entire interest rates for businesses investing in manufacturing machinery and new equipment or using automation technologies; for projects using renewable energy, thus saving power and minimising environmental pollution; projects that produce plastic chemicals, rubber, textiles and garments, leather and shoes, electronics and information technology; and projects in food processing.

Projects that invest in construction of exhibition centres for trading industrial products and parts; building centres for design, research, application and development of industrial products and parts supply, as also businesses supplying gases and chemicals to factories and research and development labs can a 50 per cent interest rate subsidy. — VNS