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Director of the Ho Chi Minh City Department of Labor, Invalids and Social Affairs Le Van Thinh |
The Resolution 98/2023/QH15 on piloting many specific mechanisms and policies for the development of Ho Chi Minh City (Resolution 98) which is effective from August 1 helps the southern metropolis to allocate public investment capital to support poverty reduction and job creation. The Bank for Social Policies in the city branch was assigned to provide loans to support poor households, near-poor households, and households that have just escaped poverty, and create jobs.
The city's sustainable poverty reduction program in the 2021-2025 period has the goal of striving to reduce the average rate of poverty-stricken households by 0.35 percent annually and the near-poor households rate by 0.2 percent a year on average. The southern largest city is determined to fight the poverty rate so that there will be no poor households by the end of 2025 according to the national poverty standard, and less than 0.5 percent of poor households according to the city poverty line. The Resolution 98 plays a pivotal role in fighting poverty and ensuring social security and sustainable poverty reduction for the sake of poor city inhabitants and workers in the city.
Especially in the current context when businesses are facing difficulties, gradually narrowing the scale of production; subsequently, lots of workers became unemployed, affecting their living quality. It is hoped that this preferential loan will contribute to the unemployment rate reduction and the fight against black credit, helping workers with capital to organize their production and business, creating jobs generating income for their stable lives.
City dwellers' demand for loans is increasing with higher the loan reaching the prescribed maximum loan level of VND100 million a household for the loan source to support poverty reduction and VND 100 million an employee for job creation. Loans were used for production and business so as to create on-the-spot jobs for workers’ family members and they gradually stabilize lives.
Loans to support poverty reduction and job creation are credit sources with preferential interest rates. Therefore, beneficiaries of loans with preferential interest rates in the city’s poverty reduction program are poor households, near-poor households, and households just getting out of poverty to have the capital for production, business, home repair, purchase of learning equipment, vocational training, and health care or expense payment for working abroad under contracts. This loan source aims to reduce the possibility of poor households and near-poor households in the future.
The Department of Labor, Invalids and Social Affairs has coordinated with the Department of Planning and Investment to advise the municipal People's Committee to make a submission to the People's Council of Ho Chi Minh City about the allocation of medium-term public investment capital for the 2021-2025 period to provide loans to support poverty reduction and loans to create jobs. Plus, the city People’s Council should issue a resolution specifying the criteria, conditions, levels, content, form and duration of support loans. poverty alleviation and loans for job creation. The People's Council of Ho Chi Minh City issued Resolution 06/2023 on July 12.
Regarding the expected additional capital, the HCMC People's Committee approved the plan to use the medium-term public investment capital of VND 4,726 billion to supplement additional capital to support poverty reduction and loans to create jobs in the city from 2021 through 2025. This capital will be added by the city every year. As per the plan, an additional sum of VND 2,796 billion will be added from public investment capital to provide loans to support poverty reduction and job creation in 2023.
Only poor households, near-poor households in the city for the period 2021-2025, and households that have just escaped poverty within 36 months from the time of being recognized as being out of poverty are entitled to borrowing loans in the city’s poverty reduction program.
Households with a feasible loan plan in Ho Chi Minh City will be entitled to a maximum loan of VND 100 million; however, they must guarantee to use the loans as prescribed in the city People's Committee’s Decision 51/2021 on the regulation of management and use of local budget funds issued on December 15, 2021 through the Bank for Social Policies to lend to support poverty reduction in Ho Chi Minh City.
Only employees legally residing in the locality are entitled to loans for job creation where the project is implemented. They ought to have a feasible loan plan in Ho Chi Minh City, they can borrow up to VND 100 million provided that they use the loan as per the Decision 51.
When a borrower uses the loan for the right purpose but they are unable to repay the loan because of objective risks, the city has established a reserve fund to support poverty reduction and loan to create jobs to handle risks on a case-by-case basis. Simultaneously, the fund organizer should consider whether they should lend money to households for continued production and business to improve their lives.
