ASIA NEWS NETWORK
WE KNOW ASIA BETTER
Ho Chi Minh starts price stabilization programme
Publication Date : 03-04-2014
Authorities in HCM City have officially started the annual price-stabilisation programme that will run from April 1 until the end of March next year.
Under the programme, essential goods – food and foodstuff, milk, medicine and school supplies – are offered by participating companies at lower than market prices.
This year, the programme is participated by 76 enterprises, an increase of 12 firms over last year, according to the city's Department of Industry and Trade.
Banks that take part in the programme offer lower interest rates on loans for participating companies.
As of today, banks have signed agreements to provide total loans of 8.3 trillion dong (US$392.99 million) to businesses in the programme, a figure four times higher than last year, said Le Ngoc Dao, the department's deputy director.
The annual interest rates are 5.5-6 per cent for short-term loans and 7-10 per cent for medium- and long-term loans.
Of the figure, 3.35 trillion dong ($158.6 million) will be allocated for loans with a 7-8 per cent interest rate to producers, especially food and foodstuff production co-operatives that supply goods to firms participating in the programme.
Participating companies were asked to prepare sources of goods that will be 30-35 per cent higher than what was registered last year, and that meet 25-40 per cent of market demand.
Like previous years, the programme this year would see participating businesses sell at 5-10 per cent lower than market prices, she said.
Companies can hike prices if their costs increase by 5-10 per cent, but they would have to get approval from the city's Department of Finance.
Nguyen Thanh Nhan, deputy general director of Saigon Co.op, which has taken part in the price stabilisation programme for nearly 10 years, said the programme had brought practical benefits to consumers, especially low- and middle-income earners.
The company will focus more on developing its distribution network to enable more consumers to access stabilised goods, he said.
Meanwhile, Van Duc Muoi, general director of Vissan, said businesses had felt more secure about accessing capital, and the lower interest rate had also helped them reduce production costs and become more competitive.
Like last year, and in line with the campaign slogan, "Vietnamese people give priority to using Vietnamese goods", price-stabilised goods made in the country will be prioritised over imported products and products must be of good quality, said Nguyen Thi Hong, deputy chairwoman of HCM City's People's Committee.
The city has also launched a logo to label goods covered by the price stabilisation programme this year to help customers recognise price-stabilised goods more easily, which will help extend the programme's benefits to more residents, she said.