8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

1/15

VDBs Export Credit

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

2/15

Contents

Background of Exportation in Vietnam

States Export Credit Policy History

Shortcoming & Challenging

Development orientation

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

3/15

Background of Exportation in Vietnam

Moving toward market economy from centrally-planedeconomy

Driving force of Vietnam economy: Export

GDP per capita is low

Export turnover = 70 % GDP

Main export products are agriculture commodities Official ECA is non-existence

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

4/15

States Export Credit Policy History

The agencies in charge of States Export Credit policy

1995-2000: The General Department for Development andInvestment (GDDI)

2000-2006: Development Assistance Fund (DAF) 2006-now: Vietnam Development Bank (VDB)

Registered capital : USD 500 million

Government guarantee for VDB solvency Milestone: Vietnam became the WTOs 150th member on 11

January 2007

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

5/15

States Export Credit Policy History

Previous 2000

Export credit is primarily performed through State of

Commercial Banks (SOCB): Vietcombank, BIDV There is no centralized bank implementing export credit

policies of State

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

6/15

States Export Credit Policy History

2001 -2006: DAF (former GDDI)

Official export credit policy is announced (Decision No.133/2001/QD-TTg dated 10 September 2011 by PrimeMinister)

Forms of export credit: short-term lending (buyers credit,suppliers credit), long-term credit, bid bond, performancebond.

Interest rate is softer than commercial banks

Eligible commodities are limited.

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

7/15

States Export Credit Policy History

2001 -2006: DAF

72 90

310

500538

0

100

200

300

400

500

600

2001 2002 2003 2004 2005

Turnover(Unit: USD million)

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

8/15

States Export Credit Policy History

2006 2011: VDB (former DAF)

Export credit is implemented under Decree No.151/2006/QD-CP dated 20 December 2006 by PrimeMinister

Forms of export credit: short-term export credit, exportcredit guarantee, tender guarantee (bid bond) andperformance guarantee (bond)

Interest rate is adjusted in line with commercial rate

Eligible products are expanded (agriculture, forestry andaquatic products, handicraft and fine-art, industrialproducts)

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

9/15

0

200

400600

800

1,000

1,200

1,400

1,600

1,800

2006 2007 2008 2009 2010

400

475

1,364

1,622

1,010

States Export Credit Policy History

Turnover (2006-2010)

(unit: USD million)

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

10/15

States Export Credit Policy History

85%

6%2%

7%

Agriculture, forestry and

aquatic product

Handicraft and fine-art

Industrial product

Rice (Cooperation programof Government)

Segment by 2010

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

11/15

States Export Credit Policy History

2011- current: VDB

Export credit is implemented under Decree No.

75/2011/QD-CP dated 30 August 2011 by Prime Minister

Forms of export credit: short-term export credit

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

12/15

Shortcoming and Challenging

Size: rather modest compared with other ECA.

Experience: focused mostly on suppliers credit and short-

term credit.

Export credit insurance: non-existence.

Organization: both investment and export credit.

Legal status of the export policies: weak compared withother ECA.

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

13/15

Development Orientation

Overcoming weakness and challenging above.

Inheriting the current regulations in accordance with WTO

and OECD arrangement policies (interest, forms ofcredit...)

Establishing an independent agency which hasresponsibility for export credit.

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

14/15

A D D : N O . 2 5 A C AT L I N H S T R E E T , D O N G D A D I S T R I C T ,

H A N O I , V I E T N A M

T E L : 0 8 4 4 3 6 3 7 5 6 5 9

FA X : 0 8 4 4 3 6 3 7 8 1 0 4

W E B S I T E : H T T P : / / W W W . V D B . G O V . V N /

VDB contact

http://www.vdb.gov.vn/http://www.vdb.gov.vn/

8/3/2019 Sharing Vitenam's Experience in Establishing Its Export Credit Agency - Tran Tu Cat

15/15

Thank you for attention