The Asian Development Bank (ADB) and the Government of Vietnam today signed loan agreements for small and medium enterprises.
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The ADB and the Government of Vietnam today signed loan agreements for small and medium enterprises. |
Labeled the Second Small and Medium-Sized Enterprises Development Programme” (SMEDP) along with it’s sub-programme, have funds reaching approximately $100 million.
These two policy-based loans recognise achievements Vietnam has made in improving the business environment particularly for small and medium scale enterprises, and in deepening the financial sector which is also becoming more resilient to adverse external conditions. At the signing ceremony, the Government was represented by Governor of the State Bank of Vietnam Nguyen Van Giau, and ADB was represented by Country Director for Vietnam Ayumi Konishi.
SME development continues to be a key pillar of the Government of Vietnam’s efforts to sustain high economic growth in a very challenging global economic environment. In the past decade, SME and private sector development has contributed significantly in creating productive jobs for about 1.7 million young workers entering the labour market annually.
“Development of SMEs is a key for private sector development in Vietnam,” said Konishi. “We would like to see the creation of more and better jobs, and the development of supporting industries comprised of SMEs through better macroeconomic, legal and administrative framework, strengthened competition regime, and better access to finance. These are essential elements of Vietnam’s further microeconomic reforms to achieve sustainable socioeconomic growth as a new middle income country."
With regards to the financial sector, the newly approved programme focuses on the overall financial stability and the development of the non-bank financial sector, including the securities and bond markets, as well as strengthening rules and regulations to enhance transparency and provide investor and consumer protection. The results will be a more diversified and resilient sector with an increased share of capital market financing of domestic investments to support economic growth. Greater scope and efficiency of alternative non-bank financial inter-mediation channels will strengthen the stability of the financial sector through increased competition and help mitigate the risks of sector instability which reduces vulnerability of the poor falling into poverty arising from financial crisis.