HDBank Increases Green Credit To Boost Global Presence Of Vietnamese Rice

In a significant move to bolster Vietnamese rice's global presence, the HCM City Development Joint Stock Commercial Bank (HDBank) has announced an increase in its loan limits and a push for lending within the rice production and export sectors. This initiative was unveiled at the eighth congress of the Vietnam Farmers Union in December 2023, marking a pivotal moment for the nation's agricultural sector.

HDBank's introduction of its Rural Services, a comprehensive financial solution that marries smart technology with a preferential loan program for agriculture and rural areas at 0 per cent interest, underscores its commitment to this vital industry. This initiative aligns with Prime Minister Phạm Minh Chính's Directive No 10/CT-TTg, issued on March 2, 2024, which mandates the State Bank of Vietnam to facilitate credit programs supporting cooperative and business collaborations for sustainable, transparent, and effective rice production, trading, and export.

Commencing in March 2024, HDBank is set to disburse nearly VND5 trillion (US$202 million) in loans to Lộc Trời Group Joint Stock Company. This substantial financial injection aims to enhance value chains within the rice industry, encompassing fertiliser production, rice processing and exporting, distribution agents, and production households. The focus is on catering to the credit needs for purchasing and exporting rice from the 2023-2024 winter-spring crop in the Mekong Delta.

Phạm Quốc Thanh, general director of HDBank, highlighted that these loans represent a "green" capital source aimed at fostering agricultural and rural development. They are tied to promoting quality standards in production and business operations while ensuring environmental responsibility. This approach is particularly geared towards generating products that meet the stringent standards of developed markets worldwide.

The Lộc Trời Group's achievements serve as a testament to Vietnam's capabilities in the global rice market. Following the Việt Nam-EU Free Trade Agreement's implementation on August 1, 2020, the group successfully exported Vietnamese jasmine rice to the EU. By 2022, it had expanded its reach to Germany, France, and the Netherlands under its Cơm ViệtNam Rice brand. Notably, Lộc Trời became the first enterprise to introduce Vietnamese rice in E.Leclerc hypermarkets across France.

These developments reflect Vietnam's rice industry's significant strides towards achieving global recognition and adhering to strict production standards that promote green growth. The collaboration between commercial banks and the rice sector plays a crucial role in this journey towards sustainable development.

Endorsed by PM Chính at the end of 2023, the "Sustainable development of one million hectares of high-quality, low-carbon rice production associated with green growth in the Mekong Delta by 2030" programme aims for a more than 10 per cent reduction in greenhouse gas emissions compared to traditional cultivation methods. It also seeks to increase the added value in the rice value chain by 40 per cent by 2030 while ensuring profit margins exceed 50 per cent for rice farmers.

This concerted effort underscores a shared vision for Vietnam's rice industry: achieving sustainable growth that benefits both the economy and the environment. As these initiatives unfold, they promise to elevate Vietnamese rice to new heights on the world stage.