By Thanh Thuy - The Saigon Times Daily

HCMC – Enterprises have shown strong interest in the new stimulus package providing subsidized medium-term loans, and are looking forward to the detail guidance to enjoy the support soon.

Many enterprises said the support of four percentage points borne by the Government in the commercial interest rate for two years is fairly high that can help businesses to substantially lower their capital costs and thus widen trading and manufacturing operations.

Do Hoa, general director of Nghia Nippers Joint Stock Company, said that his company had enjoyed the support rate when borrowing short-term loans, and now he expected to borrow mid-term subsidized loans to build another factory as the company’s orders had increased.

“It is so lucky to have subsidized loans at this time to build new facilities,” he said, explaining that the company’s current production capacity could not meet the increasing demand.

Cao Tien Vi, general director of Saigon Paper Joint Stock Company, showed eagerness to borrow money in the second stimulus package program. He said that the company had begun a project to expand its factory in 2007 but had to put the project on hold due to economic difficulty in 2008.

“Now my company can have cheap capital to continue the project,” he told the Daily.

An executive of a private company producing conveyors said her company had concluded a loan agreement with a State-owned bank for a project to widen manufacturing, but as the lending rate is as high as 10.5% per year, so she had yet taken out the money.

She said that she would wait for the detail guidance to know whether her company was eligible to take out soft loans supported by the Government.

Banks expect that with the new stimulus package aiming to subsidize middle-term loans for enterprises, the capital demand will increase at credit institutions.

Nguyen Quoc Sy, deputy general director of Western Commercial Bank, said that with the new program, enterprises who were hesitating to widen manufacturing due to the global crisis and high lending rate would find it persuasive to carry out their projects.

Since the global financial meltdown, the Government has launched two stimulus programs to lend a helping hands to enterprises grappling with difficulties.

The first stimulus program launched late last year worth VND17 trillion aimed to provide short-term soft loans for enterprises. The Government bears four percentage points in the lending rate of loans disbursed from February 2 to late this year. In the second program announced last Saturday, the Government will also cover four percentage points in lending rate for middle-term loans made and disbursed from April 1 this year to late 2011.