What to do for businesses in the Central region to access green credit?

With a large capital demand but lacking a clear mechanism, many industrial production enterprises in the Central region have not been able to access green credit sources.

Need green capital but difficult to access

Mr. Dang Quoc Bao - Deputy General Director of Trung Nam Group said that the unit has developed a series of renewable energy projects with a total capacity of 1.6GW. Although the implemented projects require large loans, the unit has not yet accessed any loans under the green credit program. "Of the total of more than 26,000 billion VND that Trung Nam is borrowing from credit institutions, none of the loans enjoy preferential interest rates, limits or terms under the green credit program," said Mr. Dang Quoc Bao.

Industrial production enterprises, including those in the renewable energy sector, still find it difficult to access green credit sources.

According to Mr. Bao, the main reason is that at the time of implementing these projects, the green credit policy was unclear and there was no specific guidance from the authorities. In addition, the appraisal process was prolonged due to the lack of a unified criteria framework, causing investment progress to slow down. "There is no organization that represents businesses to access green capital," said a representative of Trung Nam.

Mr. Pham Bac Binh - Chairman of the Association of Small and Medium Enterprises of Da Nang said that in the near future, Da Nang city and Quang Nam province will merge, this is an opportunity for small and medium enterprises of Da Nang to have the opportunity to "grow up" because the land fund of Quang Nam province is still large. "For that reason, the coming period may be the period when enterprises will invest in factories, machinery, and new technology. This is also an opportunity and a necessary time to have a mechanism to support industrial enterprises to access green credit capital to switch to green production", Mr. Pham Bac Binh commented.

Green credit balance in the Central region is still low

Mr. Le Anh Xuan - Director of the State Bank of Vietnam, Regional Branch 9 (including Da Nang , Hue, Quang Nam, Quang Ngai, Quang Tri) said that by the end of March 2025, the total outstanding green credit in the whole region reached about 10,482 billion VND, accounting for only nearly 2% of the total outstanding debt in the whole region. And much lower than the general level of the whole country (green credit outstanding debt accounts for about 4.6% of the total outstanding credit in the whole country).

Of which, renewable energy and clean energy sectors account for about 35.5%. Notably, Quang Nam accounts for 60% of outstanding green credit in the whole region.

The Chairman of the Association of Small and Medium Enterprises of Da Nang said that the merger of the province is an opportunity for small and medium enterprises of Da Nang to "grow up" and this is also an opportunity to have mechanisms and policies to promote green production.

Although banks such as BIDV, Agribank, Vietcombank, and ACB have implemented many preferential credit packages, the reality shows that the level of green capital absorption by businesses is still limited. Credit packages have preferential interest rates of 4-7%/year (short-term) and 9-11%/year (medium-long term), some packages are even under 4%/year - but are not strong enough to create a breakthrough because many businesses have not met the strict requirements on green project criteria and ESG reports (sustainable development reports).

Mr. Le Ngoc Lam - General Director of BIDV said that recently, BIDV has deployed a series of green credit products with a total outstanding loan balance of VND 80,870 billion, accounting for more than 12% of the outstanding green credit balance of the entire Vietnamese banking industry.

From experience in implementing green credit packages, BIDV representative said that it is necessary to complete the legal framework on green finance, especially issuing a list of green project classifications and a system of ESG assessment criteria. In parallel, a national green investment fund should be established with the participation of both the public and private sectors, with clear criteria and transparent processes. Along with that, it is necessary to promote incentives for research and development (R&D) and application of environmental technology, support domestic enterprises to produce environmentally friendly products, and improve competitiveness in the international market.

The leader of the State Bank of Region 9 said that in the coming time, he will direct credit institution branches in the area to actively implement the Green Banking Development Project, have solutions to improve access to green capital, thereby increasing the proportion of green credit in total outstanding loans, especially for subjects in the Green Classification List; continue to implement the bank-enterprise connection program, direct credit institutions to reduce costs to reduce lending interest rates, especially for priority areas, green areas, application of high technology in environmentally friendly production...

Besides the efforts of banks and businesses, localities also need to have mechanisms and policies to support businesses in green transformation.

In addition to the bank's efforts, a representative of the State Bank of Region 9 said that localities and businesses must also make efforts to promote green credit. "Local People's Committees need to study and issue mechanisms and preferential support policies for green sectors such as policies on the market, training, labor, science and technology, land, etc. to create more resources to encourage green transformation. Businesses need to develop in a sustainable model, use green credit capital effectively, and raise awareness of environmental protection to avoid risks in implementing credit-granted projects," said Le Anh Xuan, Director of the State Bank of Region 9.

Green credit is an important tool to promote sustainable industrial production. However, industrial enterprises still face difficulties due to unclear policies, a lack of a synchronous legal framework, and high investment costs. Although banks have stepped in with incentive packages, for green credit to truly play its role, concerted efforts from the state, financial institutions, and enterprises are needed.

Vu Le

Source: https://congthuong.vn/la-m-gi-de-doanh-nghiep-mien-trung-tiep-can-tin-dung-xanh-387412.html