A Government instruction issued in early August decreed that tra fish farmers wishing to expand their business should be able to borrow money at the favourable interest rate of 11 per cent, with many provinces already taking action.
The Government decision came after a series of meetings between ministries, the State Bank of Vietnam and the Vietnam Development Bank to discuss solutions for boosting livestock and aquaculture production.
The majority of the tra fish growers set to benefit are concentrated in the Mekong Delta.
Accordingly, An Giang Province has disbursed roughly VND267 billion (US$12 million) for lending to farmers at the preferential interest rate of 11 per cent annually.
In Vinh Long, the Department of Agriculture and Rural Development said six farming households had been able to borrow loan from the provincial Agribank at the new rate.
Nguyen Huy Dien, deputy director general of the Directorate of Fisheries, said most of the outstanding loans that had been taken for the purpose of breeding, collecting and selling tra fishes have been adjusted to bring rates below 15 per cent.
Dien said currently, the cost for breeding tra fishes is estimated to cost around VND8 billion ($381,000) per hectare and often takes 8-10 months, forcing growers to ask for loans that take a similar time period to come through. At the same time, banks only permit short-term loans at several million dong per ha.
According to the Directorate of Fisheries, it has suggested that the Ministry of Agriculture and Rural Planning outline a policy that would allow non-governmental joint stock banks to offer preferential loans to tra fish growers and raisers.
At the same time, it also suggests the Finance Ministry should allow tra fish growers to recoup VAT taxes for costs related to buying food, as well as adding materials used in the production of livestock food to the price stablisation list.
Viet Nam expects to hit its yearly tra fish export target of $1.8-2 billion, according to the Viet Nam Seafood Exporters and Producers (VASEP).
The Vietnam Tra Fish Association is due to be inaugurated in September, a move expected to provide a further boost to the sector.
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