VND350 trillion economic recovery package: workers can borrow money to buy, rent houses

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An economic recovery package worth VND350 trillion, the largest package so far, to be disbursed in 2022 and 2023, offers many supportive measures. Workers experiencing difficulties can borrow money to buy or rent social housing.

VND350 trillion economic recovery package: workers can borrow money to buy, rent houses

On January 30, the Government issued a resolution on the socio-economic recovery and development program, which mentioned five groups of solutions, including social security and employment.

In the first half of 2022, workers who live in rented housing and work in industrial zones ( IZs) and export processing zones (EPZs), would get financial support for 3 months of rent. A minimum of VND1 million in support a month will be given to those who return to work, while those now working at enterprises can receive VND500,000 a month.

The Government has also laid down the policy on lending to help maintain and expand jobs, with the maximum lending of VND10 trillion. Individuals and households can also borrow money to buy, lend and repair houses with the total capital of VND15 trillion.

According to Minister of Labor, War Invalilds and Social Affairs Dao Ngoc Dung, in order to recover the labor market, the State will use VND6.6 trillion from the state budget to support workers for housing rent, which includes the 3-month rent to be given to those working in IZs, EPZs and key EZs.

The State also gives 3-month rent to workers returning to the labor market. This aims to attract the workers who went back to their hometowns during the pandemic.

The policy on lending to enterprises at zero interest rates to pay wages to workers will continue to be implemented.

Also, workers can borrow money at preferential interest rates to develop business production, with loans worth up to hundreds of million of dong.

In order to help workers settle down and ensure minimum housing security, the Bank for Social Policies will launch the biggest-ever credit package with very low interest rates, providing loans to enterprises to build dorms and housing for workers, and lend money to workers to fund low-cost housing purchases.

Under a support package worth VND7.5 trillion, money will also be disbursed to help enterprises to give training to workers.

The Ministry of Labor, War Invalids and Social Affairs (MOLISA) will submit the plan to the Government, which will reports to the NA Standing Committee on the VND6.6 trillion to support workers and loans to help production resumption.

The Minister said soon after this, it will immediately begin implementing the policies.

This year’s implementation of the support policy will use the national database on population and social insurance to identify workers’ permanent residences, temporary residences and jobs. However, the ministry still needs the cooperation of local authorities.

Infrastructure

An economic recovery package worth VND350 trillion, the largest package so far, to be disbursed in 2022 and 2023, offers many supportive measures. Workers experiencing difficulties can borrow money to buy or rent social housing.

The important infrastructure projects that the Government is focusing on are the North-South Expressway, the routes that connect northern mountainous areas, Central Highlands and central region; the highways in southeastern region, and the Mekong Delta; and transport infrastructure that connects regions, seaports, border gates, IZs; and digital infrastructure and digital transformation.

Meanwhile, the schemes and policies that hinder production and business will be eliminated in a program on institutional and administrative reform to improve the business environment.

More administrative procedures will be implemented online, while breakthrough solutions to promote digital transformation, digital economy, and the green and circular economy will be implemented.

The Government will provide an interest rate and management fee subsidy, VND2 trillion at maximum, so that the Bank for Social Policies can provide preferential loans.

It will also give a 2 percent interest rate subsidy per annum on loans with interest rates of over 6 percent per annum, to be disbursed by the bank in 2022-2023. The total amount of capital for the program is VND3 trillion.

The reopening of the economy needs to be associated with investments to improve healthcare and pandemic prevention and control capability. The reopening of tourism, air transport and entertainment services will be guided by the appropriate agencies.

The Government has launched a series of policies on tax, fee and charge remissions for 2022, including VAT reductions.

The VAT reduction is not applied to the sectors of telecommunications, finance and banking, securities, insurance and real estate.

The environment protection tax imposed on air fuel has been cut by 50 percent. The vehicle registration tax on domestically assembled cars was cut by 50 percent. The enterprises, business households and individuals who have to suspend operation because of Covid-19 will enjoy 30 percent land and water surface rents in 2022.

Commercial banks will give an interest rate support of 2 percent per annum in 2022-2023, applied to loans of enterprises, business households and cooperatives which can pay debts and recover; the enterprises in the sectors of aviation, freight and storage, tourism, accommodation service, education and software exports.

The banking sector aims to cut the lending interest rate by 0.5-1 percent in the next two years. The Government is also considering reducing electricity charges.

US$1 = VND23,200

Gia Van

The COVID-19 pandemic has caused local firms to face an array of risks, with there being a large and possible long-lasting vulnerability for them.

The rising global oil and gas prices will affect domestic production as oil and gas cost makes up around 3.52 percent of the economy’s total production costs, thus pushing up product prices.

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