The European Investment Bank is providing a EUR 30 million loan to the Socialist Republic of Vietnam to support investment by local companies.
The funds will be targeting small and medium-sized investments undertaken by EU-owned companies, by joint ventures between EU and Vietnamese partners, or investment in which mutual interest is significant (e.g. technology and know-how transfer, environment improvement and protection).
The 15-year loan, with 4 years grace period, will be channelled by the Ministry of Finance to three state-owned commercial banks (Bank for Foreign Trade of Vietnam, Bank for Investment & Development of Vietnam, Vietnam Bank for Agriculture and Rural Development).
Both in the private and public sectors, the three banks will allocate loans to local companies operating in industry, agro-industry, infrastructure, tourism, energy and telecommunications, as well as in related services and in some health and urban development schemes. The loans to companies may cover up to 50 % of the total cost required to modernise and expand so as to remain competitive.
Through the EIB loan supported by the budget guarantee, the EU is making available long-term financing needed to fill a portion of the resource gap for term lending and assist efforts to reduce poverty and improve employment opportunities and welfare.