Hanoi (VNS/VNA) - The banking sector pledged to meet the capital demandfor production and business, especially in five prioritised sectors, DeputyGovernor of the State Bank of Vietnam (SBV) Dao Minh Tu said at a conferenceconnecting enterprises and banks in Hanoi on April 16.

The five sectors include agriculture and rural development,exports, parts-supply industry, small- and medium-sized enterprises (SMEs) andhigh-tech firms.

"If credit is tightened to reach the Government's goalof controlling inflation, it will be only tightened in sectors which potentialrisks," Tu said, affirming no credit shortages for the prioritisedsectors.

Stressing the role of businesses in the country'ssocio-economic development, Tu said the banking sector would continue to createfavourable conditions for firms to access credit, not only through simplifyingprocedures but also by cutting costs in order to reduce lending rates.

Tu said the central bank would continue its flexiblemonetary policies to contribute to controlling inflation and stabilising themacro-economy. Credit expansion would focus on quality, he said.

According to Nguyen Van Than, President of the VietnamAssociation of SMEs, most SMEs are in dire need of capital for production butface difficulties accessing credit due to limited financial capacity, a lack oflegally mortgaged assets and a lack of transparency for trust-based loans.

Than urged banks to develop lending programmes for SMEs andshare risks with them.

Tran Thu Hang, general director of a food export company,said that banking procedures needed to be further simplified, especially forSMEs, to enable them to access credit instead of resorting to loan-sharks atunreasonably high rates.

According to Tran Van Tan, deputy director of the centralbank's Credit Department, in an effort to remove difficulties for firms, morethan 1,500 meetings between banks and businesses had been held since 2014.

Outstanding loans under a programme connecting banks withfirms totalled 2.5 quadrillion VND (107.6 billion USD) at rates of 6-9 percentfor short-term loans and 9-11 percent for medium- and long-term loans,statistics from the central bank showed.

In Hanoi, credit institutions provided loans worth 120trillion VND (5.18 billion USD) for more than 10,3000 firms at rates of 6-6.5 percentper year for short-term loans and 8-9 percent for medium- and long-term loansin 2018.

Outstanding loans in the economy rose by around 2.8 percentin the first quarter of this year compared to the end of 2018.

For the prioritised sectors, credit for the parts-supplyingindustry rose 3.63 percent, for enterprises which applied high technologies by7.25 percent, and for export firms by 3.5 percent.-VNS/VNA