INTER-MINISTERIAL CIRCULAR No.3/TTLB OF FEBRUARY 3, 1996 GUIDING THE SUPPLEMENTATION AND AMENDMENT TO THE POLICY OF GRANTING LOANS TO SMALL PROJECTS FOR JOB GENERATION ACCORDING TO RESOLUTION No.120-HDBT OF APRIL 11,1992 OF THE COUNCIL OF MINISTERS (NOW THE GOVERNMENT)
In implementation of Resolution No.120-HDBT of April 11, 1992 of the Council of Ministers (now the Government) on the policy, orientation and measures to generate jobs in the coming years, the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Finance, and the State Planning Committee (now the Ministry of Planning and Investment) issued Inter-ministerial Circulars No.10-TT/LB of July 24, 1992, No.17-TT/LB of September 9, 1992, No.06-TT/LB of May 12, 1993, No.12-TT/LB of April 1st, 1994, No.03-TT/LB of February 10, 1995, and Circular No.30-LDTBXH/TT of November 11, 1995 guiding the implementation of the policy of granting loans to small projects for job generation.
Since a number of stipulations of these Circulars are no longer suitable, and in implemention of Decree 72-CP of October 31, 1995 of the Government giving detailed stipulations and guidance on the implementation of a number of Articles of the Labor Code, the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Finance, and the Ministry of Planning and Investment provide the following detailed guidance for the implementation and modification of a number of stipulations:
1. Persons eligible to apply for loans:
- Those individuals and households that want to borrow capital to develop production to generate jobs for themselves, including households of State workers and employees who have lost employment for a long time and households of the armed forces that have settled permanently in armymen's villages;
- Members of mass organizations;
- Production establishments, small industry, handicraft, construction and transport cooperatives drawing more laborers, particularly laborers who have lost their jobs.
- Production establishments of invalid and sick armymen, disabled persons; young volunteers; establishments of production combined with medical treatment and education for social offenders.
Among the loan applicants, priority should be given to those households owners of production establishments covered by the preferential treatment policy, and those production establishments which employ many laborers covered by the preferential treatment policy. In applying for loans, the applicants must outline their projects according to the guidance in Document No.1979/LDTBXH of July 11, 1992 of the Ministry of Labor, War Invalids and Social Affairs.
2. Interest rates of loans:
From March 1st, 1996, the interest rates of loans from the National Fund for job generation for small projects are set as follows:
a/ The projects which have been approved for receiving loans for different terms shall bear a common interest rate of 0.9%/month. This interest must be paid in a lump sum in proportion to the principal borrowed and the actual time of borrowing. The interest shall not be added to the principal. Both principal and interest must be paid when due.
The loans granted before March 1st, 1996 shall bear the interest rate set in Decision No.364-TC/CDTC of June 18, 1993 of the Minister of Finance.
b/ The interest rate of overdue debts is set at 200% of the basic interest rate mentioned above.
The project owners who receive loans shall not have to pay for any other expenses in addition to the interest and principal.
3. Expenditure on management and operation:
Part of the profits collected shall be used to cover the expenditure on management, operation and services in granting loans by the system of State Treasuries, the Leading Committees of provinces, cities, districts and precincts, owners of local projects, central organizations, mass organizations, and leading State agencies at the central level.
The Ministry of Finance shall issue a document giving detailed stipulations on this matter after consulting the Ministry of Planning and Investment and the Ministry of Labor, War Invalids and Social Affairs.
4. The terms of loans:
Loans are granted on three terms: 12 months, 24 months and 36 months. The term of a loan depends on the aim of capital use, the characteristics of a production branch, and the maturity cycle of each kind of plant and animal (see attached appendix).
Well-executed projects which want to borrow for another term, their application for a second term of loan shall be considered for approval. With regard to long-term production projects they shall have the term of their loan rescheduled accordingly. The procedure and conditions for approval of a second term of the loan or rescheduling of the loan shall comply with the stipulations in the Inter-ministerial Circular (of the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Finance, and the State Planning Committee) No.12-TT/LB of April 1st, 1994.
5. Organization of implementation:
- The State Treasuries in the provinces and cities shall grant loans and retrieve capital according to the decision on the granting of loans of the People's Committees of the provinces and cities, or the Heads of the State agencies at the central level. No one has the right to reschedule a loan of his own accord.
- Every month and every quarter, the State Treasuries of the provinces (cities) shall promptly report the granting of loans (according to the guidance of the Central State Treasury) to the Leading Committees of the provinces and the Central State Treasury. On this basis, the Central State Treasury shall file a general report to the Ministries concerned.
Every quarter and at year's end, the People's Committees of the provinces and cities and the Heads of central organizations and mass organizations shall file detailed reports on the granting of loans and job generation to the Ministries corcerned.
This Circular takes effect from the date of its signing and shall replace the corresponding points in the previous Inter-ministerial Circulars which are no longer suitable. In the process of implementation, if the localities, branches and mass organizations discover any problem, they should inform the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Finance, and the Ministry of Planning and Investment for consideration and settlement.
For the Minister
of Planning and Investment,
PHAM GIA KHIEM
For the Minister of Finance,
LE THI BANG TAM
For the Minister of Labor,
War Invalids and Social Affairs,
NGUYEN LUONG TRAO
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Pham Gia Khiem
Le Thi Bang Tam
Nguyen Luong Trao