This Circular provides detailed regulations on the receipt, use, and repayment of loans from AFD for the Vietnam Coffee Development Program. It includes contents such as counterpart fund management, annual disbursement plans, withdrawal methods, loan rescheduling and debt repayment management, as well as periodic reporting systems.
적용 범위
Vietnam Coffee Corporation, People's Committees of provinces implementing the Coffee Development Program, and related agencies.
핵심 사항
- Management of counterpart funds from sources such as settlement programs, state investment credit programs.
- Annual disbursement plan for AFD loans based on the progress of the Program implementation.
- Withdrawal methods include refinancing paid costs, direct payment to suppliers, and continuous advances.
- Management of loan rescheduling with the Investment Development General Department and the responsibility for timely debt repayment.
- Periodic report every six months on the situation of capital usage and debt repayment.
🌐 이 문서의 사회적 영향
- Strengthening financial management in the Coffee Development Program to ensure the effective use of AFD loans.
- Supporting localities within the Program area to access preferential state credit to supplement counterpart funds.
- Improving the financial management and monitoring capacity of Vietnam Coffee Corporation and related agencies.
❓ 자주 묻는 질문
When does this Circular take effect?
This Circular takes effect fifteen days after the date of signature.
How must the relevant parties implement periodic reports?
Relevant parties must periodically report every six months to the Ministry of Finance and related agencies on the situation of receiving, using, and repaying AFD loans.
Who should be informed if issues arise during the implementation of this Circular?
Vietnam Coffee Corporation, People's Committees of provinces implementing the Program, and related agencies must promptly inform the Ministry of Finance to consider and resolve any issues that arise.
전문
CIRCULAR
Guidelines for the financial mechanism for the Coffee and Tea Development Loan Program
Pursuant to Decree No. 87/CP dated August 5, 1997 of the Government promulgating the Regulations on Management and Use of Official Development Assistance (ODA) Sources and Decree No. 90/1998/NĐ-CP dated November 7, 1998 of the Government promulgating the Regulations on Management of Foreign Borrowing and Repayment and related guiding documents;
Pursuant to Decree No. 42/CP dated July 16, 1996 of the Government promulgating the Charter on Investment and Construction Management and Decree No. 92/CP dated August 23, 1997 of the Government amending and supplementing certain provisions of the Charter on Investment and Construction Management and related guiding documents;
Pursuant to Decision No. 172/TTg dated March 24, 1997 of the Prime Minister approving the program to develop 40,000 hectares of Arabica coffee and tea until 2001;
Pursuant to the Credit Agreement No. CVN 1025 01 C dated November 4, 1998 (hereinafter referred to as the "Agreement") for the Coffee and Tea Development Program (hereinafter referred to as the "Program") signed between the Ministry of Finance and the French Development Agency (hereinafter abbreviated as "AFD");
Pursuant to Circular No. 1258/CP-NN dated October 24, 1998 of the Government approving the Credit Agreement and the lending mechanism for the AFD loan program;
The Ministry of Finance guides the financial mechanism for the AFD loan program for coffee and tea development implemented by Vietnam Coffee Corporation (hereinafter abbreviated as "VINACAFE") as follows:
I. GENERAL PROVISIONS
1. The AFD loan funds for the Program are foreign debt of the Government. Therefore, the entire loan amount is recorded in the State budget. The Ministry of Finance is responsible for repaying the debt to the foreign side when due.
2. VINACAFE is the project sponsor and the implementing agency of the Program, responsible for using the AFD loan funds to invest in development according to the plan and effectively, in accordance with the conditions stipulated in the Agreement signed with AFD, and repay the State budget according to the rescheduling loan contract signed with the General Department of Investment and Development and the provisions of this Circular.
3. The General Department of Investment and Development is responsible for implementing the rescheduling of the AFD loan, managing and recovering the loan debt from the project sponsor, and receiving fees for rescheduling state credit funds according to regulations.
1. Scope of handling risky debts
1. On organization and implementation of the program:
VINACAFE is responsible for organizing and directing the implementation of the entire program:
- Establish a program management board consisting of VINACAFE and representatives of relevant agencies of localities with projects. VINACAFE needs to establish regulations for the program management board at all levels, clearly defining responsibilities such as planning (investment, disbursement of loan funds, counterpart funds), production organization, financial organization and accounting ..., while closely coordinating with localities implementing the Program.
- Organize the appraisal and approval of component projects under the Program with the participation of relevant Ministries and sectors, ensuring compliance with current regulations on investment and construction management as well as being consistent with approved investment plans.
- VINACAFE must bear full credit risk for the entire Program and exchange rate risk for components borrowed in foreign currency.
The Agricultural Bank of Vietnam is designated as the bank serving transactions for withdrawing funds for the Program, and is responsible to VINACAFE (if entrusted) for rescheduling loans, managing and recovering loan debts from users (household farmers, provincial companies and farms ...), and receives service fees according to the Entrustment Contract signed with VINACAFE.
2. Rescheduling mechanism for the Program:
The Government through the Ministry of Finance lends VINACAFE the entire amount of 212 million French francs borrowed from AFD. The Ministry of Finance directly implements the withdrawal of the AFD loan and reschedules it to VINACAFE and recovers the loan debt through the General Department of Investment and Development system.
The conditions for loan refinancing shall be stipulated according to each loan component as follows:
a) For loan components for agricultural production, rural infrastructure, small-scale milling machines, processing stations, and quality control facilities (with a total loan value of 160,645 million French Francs):
- The Ministry of Finance will refinance VINACAFE and recover the loan debt in Vietnamese Dong, with foreign exchange risks borne by the State Budget. The conversion rate on the day of capital withdrawal for VINACAFE to receive the debt from the Ministry of Finance in Vietnamese Dong shall be applied according to the monthly foreign currency-Vietnamese Dong accounting rate prescribed by the Ministry of Finance.
- The refinancing interest rate is 0.41% per month (equivalent to 4.92% per year), which includes the refinancing fee of the General Department of Investment and Development at 0.01% per month (equivalent to 0.12% per year) calculated on the outstanding principal balance of the refinanced loan. VINACAFE shall bear all credit risks.
- The refinancing period is 10 years, including a grace period of 3 years starting from April 15 and October 15 annually for capital withdrawals during each six-month period, specifically as follows:
+ For capital withdrawals made from October 16 of the previous year to April 15 of the following year, the grace period for these withdrawals is 3 years starting from April 15 of the following year.
+ For capital withdrawals made from April 16 to October 15, the grace period for these withdrawals is 3 years starting from October 15.
- VINACAFE may directly or through the Agricultural Bank of Vietnam provide loans in Vietnamese Dong to end-users (household farmers, provincial coffee companies, and farms under VINACAFE) at a unified interest rate of 0.81% per month (equivalent to 9.72% per year).
The difference of 0.4% per month (equivalent to 4.8% per year) between the refinancing interest rate of the Ministry of Finance at 0.41% per month and the interest rate of VINACAFE at 0.81% per month for lending to end-users shall be retained by VINACAFE for organizing further refinancing activities, managing the loan funds, establishing a risk compensation fund, and supplementing the source of repayment for the loan component for research costs, training, management expenses, and reserves (as specified in paragraph (b) below). The fee paid to the entrusted unit for implementing refinancing shall be agreed upon by VINACAFE and the entrusted unit in accordance with the regulations set by the State.
- Late payment penalties shall be specifically stipulated by the General Department of Investment and Development in the Refinancing Loan Agreement signed with the Project Owner, but not lower than the late payment penalty rate specified in the Agreement.
Regarding the interest payment for coffee-growing households during the initial construction period, VINACAFE shall directly negotiate with the provinces to formulate specific measures.
b) For loan components for investment in processing plants and research, training, management expenses, and reserves (with a total loan value of 50,676 million French Francs):
- The Ministry of Finance will refinance VINACAFE and recover the loan debt in French Francs.
- The refinancing interest rate is 4.5% per year, which includes the refinancing fee of the General Department of Investment and Development at 0.2% per year calculated on the outstanding principal balance of the refinanced loan.
- The refinancing period is 10 years, including a grace period of 3 years starting from April 15 and October 15 annually for capital withdrawals during each six-month period, specifically as follows:
+ For capital withdrawals made from October 16 of the previous year to April 15 of the following year, the grace period for these withdrawals is 3 years starting from April 15 of the following year.
+ For capital withdrawals made from April 16 to October 15, the grace period for these withdrawals is 3 years starting from October 15.
- VINACAFE is responsible for calculating and balancing foreign currencies for debt repayment and shall bear all foreign exchange and credit risks for these components.
- Late payment penalties shall be specifically stipulated by the General Department of Investment and Development in the Refinancing Loan Agreement signed with the Project Owner, but not lower than the late payment penalty rate specified in the Agreement.
- Additionally, for the entire loan amount, VINACAFE shall bear all external fees (if any) payable to AFD. These fees shall be notified and collected directly from VINACAFE by the General Department of Investment and Development.
3. Guidelines for drawing down funds:
Counterpart funds:
According to Decision No. 172/TTg dated March 24, 1997 of the Prime Minister, domestic counterpart funds amounting to 331 billion Vietnamese Dong shall be allocated from sources such as agricultural promotion programs, job creation, poverty reduction, settlement, and self-investment by farmers, VINACAFE, coffee enterprises, and the public.
After localities with projects have calculated the need for counterpart funds from the aforementioned sources, if the domestic counterpart funds still fall short of the amount specified in Decision No. 172/TTg dated March 24, 1997 of the Prime Minister, VINACAFE shall be responsible for coordinating with the localities to develop plans for state investment credit borrowing to supplement the annual counterpart funds according to the progress of the Program. The counterpart fund plan must be developed concurrently with the disbursement plan for AFD loans. The additional need for counterpart funds from the above-mentioned state investment credit sources shall be compiled by VINACAFE and worked out with the Ministry of Planning and Investment and the Ministry of Finance (General Department of Investment and Development) to determine and allocate the counterpart fund plan for each locality and specific entity according to Circular Joint No. 06/1998/TTLT-BKH-BTC dated August 14, 1998 of the Ministry of Planning and Investment and the Ministry of Finance guiding the management mechanism for counterpart funds for programs and projects using official development assistance (ODA) sources. The signing and implementation of the preferential investment credit agreement according to the allocated fund plan shall be carried out by VINACAFE and the localities implementing the Program in consultation with the preferential lender.
Withdrawal of AFD loans:
Based on the Agreement and the progress of the Program, VINACAFE shall develop an annual disbursement plan for AFD loans to be submitted to the Ministry of Finance, paying attention to implementing certain provisions of the Agreement as follows:
- Before withdrawing funds, VINACAFE needs to prepare and submit to the Ministry of Finance a guide on implementing the Program, the conditions for refinancing to the final end-users, plans, cost estimates, service supply contracts, equipment... for the Ministry of Finance and AFD to review and confirm the allocation and use of credit.
- Goods and services financed by the AFD loan must originate from France or Vietnam.
- The Project Owner is responsible for strictly adhering to current regulations regarding tender selection procedures, tender documents, and tender results, and reporting to the Ministry of Finance (Department of Foreign Financial Affairs and General Department of Investment and Development) and AFD if required.
- Any changes in the cost allocation and financial plan of the Program that differ from the provisions in Appendix 2 of the Agreement must be approved by the Ministry of Finance and AFD beforehand.
Depending on the actual requirements of the Program and at the request of VINACAFE, the withdrawal of AFD loans may be implemented in one of the following methods:
a. Refinancing expenses already paid by VINACAFE:
Based on the request and invoices and supporting documents for expenses incurred by VINACAFE, the Ministry of Finance requests AFD to withdraw funds for repayment into VINACAFE's account at the Agricultural Bank and Rural Development Bank. Payment documents may be in the form of certified copies of original documents from VINACAFE, clearly indicating the date of payment. For invoices with a value under 3,000 French francs, VINACAFE only needs to send a statement of expenditures to the Ministry of Finance (Department of Foreign Financial Affairs) to process the withdrawal with the French side. Additionally, according to AFD's requirements, VINACAFE may need to provide necessary documents proving that the aforementioned expenses have been effectively invested.
Specifically for the payment of completed basic construction volumes under the construction and installation contract, there must also be a certificate of acceptance and a price list confirmed by the investment development agency.
b. Direct payment to suppliers:
This method mainly applies to contracts for construction and installation or supply of machinery and equipment with suppliers, or consultancy contracts with consulting companies. Based on the conditions stipulated in signed contracts and invoices confirmed and requested for payment by VINACAFE, the Ministry of Finance (Department of Foreign Financial Affairs) will process the request for AFD to make direct payments to suppliers or consulting companies.
Specifically for the payment of completed basic construction volumes under the construction and installation contract, there must also be a certificate of acceptance and a price list confirmed by the investment development agency sent to the Ministry of Finance (Department of Foreign Financial Affairs) to request AFD to make direct payments to the construction contractor.
c. Withdrawal of funds through continuous advance payments:
Based on the annual coffee planting plan established by the project owner and approved by the Ministry of Finance and AFD, the Ministry of Finance may request AFD to withdraw funds through continuous annual advances and transfer them into a special account opened by the project owner at the Agricultural Bank and Rural Development Bank.
From the second withdrawal period onwards, before each withdrawal, the project owner must prepare and submit to the Ministry of Finance for forwarding to AFD a withdrawal file including:
+ Notification of the special account for the previous withdrawal period,
+ Statement of fund usage for the previous withdrawal period,
+ Total costs and certificates of origin for related equipment,
+ Information about the final users of the funds, loan agreements, and corresponding coffee planting areas,
+ Documents confirming payments made by VINACAFE and confirmation documents from the investment development agency regarding these payments.
In addition, the project owner is responsible for providing AFD with original files, documents, and other relevant materials for verification and comparison if required. For the final withdrawal, the above file must be submitted to the Ministry of Finance and AFD no later than six months after the withdrawal is carried out.
4. Management of loan rescheduling and repayment of borrowed capital:
The project owner is responsible for signing a Loan Rescheduling Agreement with the Investment Development General Department according to the rescheduling terms set forth in Part II; implementing full and timely repayment of borrowed capital according to this Loan Rescheduling Agreement, and bearing legal responsibility for the proper use of borrowed capital.
Based on the actual withdrawal date of AFD recorded in the statement, and the approval notice of the budget estimate of withdrawn capital prepared by the Department of Foreign Financial Affairs for accounting purposes, the Investment Development General Department is responsible for informing VINACAFE of the actual amount withdrawn and requesting VINACAFE to sign a promissory note.
The Investment Development General Department is responsible for monitoring the use of borrowed capital and the use of assets financed by government loans, recovering rescheduled loans, and reporting to the Ministry of Finance on the recovery of rescheduled loans.
5. Reporting system:
VINACAFE is responsible for reporting to the Ministry of Finance (Investment Development General Department, Department of Foreign Financial Affairs), the Ministry of Planning and Investment, and the supervising authority every six months on the situation of receiving, using, and repaying AFD loans and counterpart funds.
VINACAFE is responsible for providing the Ministry of Finance and AFD with an annual audit report and any other financial information if requested according to the Agreement.
The project owner must prepare and submit to the Ministry of Finance (Department of Foreign Financial Affairs and Investment Development General Department) and AFD a comprehensive report on the implementation and final settlement of the Program no later than three months after the end of the Program.
III. IMPLEMENTATION PROVISIONS
This Circular takes effect fifteen days after the date of signature. During implementation, if there are any difficulties, the Vietnam Coffee Corporation, People's Committees of provinces implementing the Program, and related agencies are requested to promptly reflect them to the Ministry of Finance for consideration and resolution.
DEPUTY MINISTER
관계도
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