JOINT CIRCULAR No. 446-TC/LB Supplementing Joint Circular No. 22-TT/LB dated January 14, 1970 on the issuance and lending of construction capital to local state-owned industrial enterprises and guiding the lending of funds for the purchase of transportation equipment by localities.

JOINT CIRCULAR
Supplementing Circular Joint No. 22-TT/LB dated January 14, 1970 on the issuance and lending of capital for basic construction to state-owned industrial enterprises at the provincial level and guiding the lending of capital for purchasing transportation means for localities
loans for basic construction for state-owned industrial enterprises at the provincial level and guidelines for providing loans to purchase transportation means for localities
methods and guidelines for providing loans to purchase transportation vehicles for
localities

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Implementing Decision No. 28-TTg/TN dated March 19, 1969 of the Prime Minister on the issuance and lending of capital for basic construction and working capital to state-owned industrial enterprises at the provincial level, the Ministry of Finance and the State Bank of Vietnam issued Circular No. 22-TT/LB dated January 14, 1970 on the issuance and lending of capital for basic construction.

From the beginning of the year until now, some localities have borrowed from the State Bank to expand or build new production bases of state-owned industrial enterprises at the provincial level.

To further promote the development of local economies, investment in basic construction not only relies on self-generated funds guaranteed by the local budget and basic construction funds subsidized by the central government according to principles stipulated in Decree No. 118-CP dated August 1, 1967 of the Council of Ministers on the decentralization of financial management but also must actively utilize the borrowing capital of the State Bank.

The Ministry of Finance and the State Bank of Vietnam recognize that it is necessary to increase the loan limit for industry up to 300,000 dong, while expanding the scope of borrowing capital from the State Bank to local transport companies to purchase transportation means based on actual needs, specifically:

1. The subjects eligible to borrow long-term capital from the State Bank to develop industry have been clearly stated in Circular Joint No. 22-TT/LB dated January 14, 1970.

Regarding borrowing to purchase new transportation means, it is now stipulated that independent accounting transport companies at the local level may borrow capital to purchase new types of cargo trucks, passenger buses or boats, and canoes (hereinafter collectively referred to as transportation means).

2. Loan amount:

- For local industrial enterprises, the loan amount can be increased up to 300,000 dong, calculated separately for each project.

- For local transport companies, based on the local transport development needs, the local budget's ability to provide capital, and the company's own capital, the Bank will determine the specific loan amount.

3. Source of loan capital

Annually, the State Bank of Vietnam bases its loan capital plan for the year on the distribution indicators of the State Planning Commission for transportation means for localities and the basic construction indicators of state-owned industrial enterprises at the local level. The Ministry of Finance transfers capital according to the plan at the beginning of each quarter to the State Bank of Vietnam.

4. Loan procedures:

Follow the previous guidance on loans to state-owned industrial enterprises at the provincial level.

5. Term and interest rate of credit.

Local transport companies borrowing capital from the State Bank to purchase new transportation means as mentioned in Point 1 above must repay the State Bank within three years, with possible extension up to a maximum of five years from the date of borrowing; the annual interest rate payable is 2.16% (0.18% per month).

The source of capital to repay and pay interest on long-term loans for purchasing transportation means shall be implemented in accordance with Decision No. 28-TTg dated March 19, 1969 of the Prime Minister and Circular Joint No. 22-TT/LB dated January 14, 1970.

By the end of the year, the State Bank of Vietnam will transfer the recovered capital for long-term loans for basic construction, expanding state-owned industrial production at the provincial level, and local transport companies into the central government budget.

This Circular Joint takes effect from January 1, 1971.

During implementation, if there are any difficulties, the localities are required to promptly report to the joint ministries for research and resolution.