The spirit is willing, but the capital is weak
Nurturing a project on food processing, Huynh Van Hai, Director of the Bao Long Food Technology Company, many times flew to Taiwan to choose the technology for the production line, hoping to be able to import the technology soon.
It is estimated that the project would cost 10 billion dong. Of this amount, the company would spend 8 billion dong, while Hai hopes he can borrow 2 billion dong from the HCM City Fund for Science and Technology Development at the preferential interest rate of 7 percent per annum.
The HCM City authorities have decided to offer the preferential interest rate to the enterprises which run their programs to renovate technology to serve their production.
However, Hai now feels discouraged because he has not received any reply from the relevant agencies, since the day he applied for the preferential loan one year ago.
Hai said that though the regulations on preferential loans are clear, implementation agencies like “putting barriers for businesses.” However, Hai has been determined to access the preferential loan, even if he has to wait 5 or 10 years.
Hai, who is also the Chair of the Hoc Mon district’s business association, said that the association’s member companies are also seriously lacking capital, though they have feasible and profitable investment projects.
Other enterprises, feeling discouraged by the complicated procedures, decided to “give up the game” and borrow money at commercial interest rates. Dai Phat Group, which could not access the preferential loan, had to borrow commercial loan for the project on upgrading technology worth 30 billion dong. Deputy Director of Dai Phat Group said that with the sky high commercial interest rates, the company has to pay 6 billion dong a year in interest.
Improper mechanism causes capital shortage
The latest survey conducted by UNDP and the Central Institute of Economic Management (CIEM) on the use of equipments and technologies of domestic enterprises, has found out that the enterprises cannot find capital for technology renovation.
The survey on 100 businesses in Hanoi and HCM City showed that enterprises only spend 3 percent of annual turnover to renovate equipments and technologies.
Businesses complain that banks refuse to provide loans, saying that the projects are unfeasible, or unprofitable. Meanwhile, they said that the bank officers who consider the businesses’ projects, are not the experts in the fields, therefore, they do not have good knowledge enough to examine the projects.
While businesses blame banks and state management agencies on the difficulties in accessing official loans, the HCM City Department of Science believes that businesses should blame themselves on this.
The department said that enterprises still lack information and remain passive in accessing capital sources. After two years of implementing the above said plan, only 10 percent of the 600 polled enterprises registered their programs to renovate technologies. Most of the enterprises were small and medium ones which did not really focus on building the strategies to renovate technologies, products and develop technological capability.
The report of the department shows that over the last two years, the HCM City Fund for Science and Technology Development could only guided and gave consultancy on the procedures to borrow capital to over 50 enterprises.
Source: TBKTSG
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