Circular No. 48 TC/DT GUIDING THE MANAGEMENT AND USE OF LOANS FOR THE PURCHASE OF MACHINERY AND EQUIPMENT FROM THE COOET FUND FOR THE VAN DINH PROJECT.

CIRCULAR

GUIDELINES FOR THE MANAGEMENT AND USE OF LOANS FOR THE PURCHASE OF MACHINERY AND EQUIPMENT FROM THE COOET FUND FOR THE VAN DINH PROJECT.

BASED ON THE LOAN AGREEMENT BETWEEN THE VIETNAMESE GOVERNMENT AND THE ARAB ECONOMIC DEVELOPMENT FUND (COOET) FOR THE VAN DINH PROJECT, SIGNED ON JANUARY 12, 1987.

BASED ON DECISION NO. 91/TTG OF NOVEMBER 13, 1992 BY THE PRIME MINISTER REGULATING THE MANAGEMENT OF IMPORTS OF MACHINERY AND EQUIPMENT FUNDED BY THE STATE BUDGET.

BASED ON DECREES NO. 58/CP OF AUGUST 30, 1993 BY THE PRIME MINISTER ISSUING THE REGULATIONS ON THE MANAGEMENT OF FOREIGN LOANS AND REPAYMENTS, AND THE CIRCULARS GUIDING THE IMPLEMENTATION OF THE SAID DECREES.

AFTER CONSULTATION WITH THE NATIONAL PLANNING COMMITTEE, THE STATE BANK OF VIETNAM, THE MINISTRY OF WATER RESOURCES AND RURAL DEVELOPMENT, AND THE VIETNAM INVESTMENT DEVELOPMENT BANK, THE MINISTRY OF FINANCE GUIDES THE MANAGEMENT AND USE OF THE LOAN FOR THE PURCHASE OF MACHINERY AND EQUIPMENT FROM THE COOET FUND FOR THE VAN DINH PROJECT AS FOLLOWS:

I. GENERAL PROVISIONS:

1/ THIS CIRCULAR APPLIES ONLY TO THE SECOND LOAN INSTALLMENT FOR THE IMPORT OF CONSTRUCTION MACHINERY AND EQUIPMENT FOR THE VAN DINH PROJECT. PREVIOUS SHIPMENTS (RECORDED IN THE STATE BUDGET) AND FUNDS TO BE USED FOR THE PURCHASE OF IRON AND STEEL ARE NOT COVERED BY THIS CIRCULAR.

2/ THE LOAN FOR THE PURCHASE OF MACHINERY AND EQUIPMENT FROM THE COOET FUND FOR THE VAN DINH PROJECT IS A FOREIGN GOVERNMENT LOAN, THEREFORE PROCEDURES FOR WITHDRAWAL, USE, AND REPAYMENT OF THE LOAN MUST BE CONDUCTED IN ACCORDANCE WITH DECREES NO. 58/CP OF AUGUST 30, 1993 BY THE PRIME MINISTER, THE CIRCULARS GUIDING THE IMPLEMENTATION OF THE SAID DECREES, AND THE TERMS AND ATTACHMENTS OF THE LOAN AGREEMENT BETWEEN THE VIETNAMESE GOVERNMENT AND THE ARAB ECONOMIC DEVELOPMENT FUND (COOET) SIGNED ON JANUARY 12, 1987.

3/ THE MINISTRY OF FINANCE TRANSFERS FUNDS TO THE VIETNAM INVESTMENT DEVELOPMENT BANK (SELECTED BY THE MINISTRY OF FINANCE AND THE STATE BANK) TO PROVIDE LOANS TO THE BORROWING UNITS.

4/ THE UNITS USING THE LOAN ARE THOSE DESIGNATED BY THE MINISTER OF WATER RESOURCES AND RURAL DEVELOPMENT.

5/ THE UNITS USING THE LOAN ARE RESPONSIBLE FOR USING, MANAGING, AND REPAYING THE LOAN IN ACCORDANCE WITH CURRENT REGULATIONS.

II. SPECIFIC PROVISIONS:

1/ THE UNITS USING THE LOAN ARE THOSE DIRECTLY OR INDIRECTLY RELATED TO THE CONSTRUCTION OF THE VAN DINH PROJECT.

2/ THE VIETNAM INVESTMENT DEVELOPMENT BANK GUIDES THE UNITS IN THE PROCEDURE FOR OBTAINING THE LOAN.

3/ THE LOANING UNITS MUST SIGN A LOAN CONTRACT WITH THE VIETNAM INVESTMENT DEVELOPMENT BANK IN FOREIGN CURRENCY (COOET DINAR), THE DATE OF RECEIVING THE LOAN BEING THE DATE WHEN COOET RECORDS THE LOAN TO VIETNAM.

4/ THE INTEREST RATE FOR THE LOAN IS 3.3% PER YEAR (BASED ON THE FOREIGN CURRENCY LOAN), INCLUDING:

+ INTEREST RATE FOR THE LOAN FROM THE COOET FUND: 3% PER YEAR

+ FEES OF THE VIETNAM INVESTMENT DEVELOPMENT BANK: 0.3% PER YEAR.

5/ IF THE UNIT DELAYS REPAYMENT, IT WILL BE HANDLED ACCORDING TO THE GENERAL PROVISIONS OF THE BANK.

6/ THE LOAN PERIOD IS UP TO 10 YEARS, INCLUDING A GRACE PERIOD OF 1 YEAR. THE VIETNAM INVESTMENT DEVELOPMENT BANK WILL DETERMINE THE LOAN PERIOD FOR EACH TYPE OF MACHINERY AND EQUIPMENT WITHIN THE ABOVE PERIOD.

7/ THE VIETNAM INVESTMENT DEVELOPMENT BANK ENCOURAGES UNITS TO REPAY THE LOAN EARLIER USING LEGAL FUNDS.

8/ THE VIETNAM INVESTMENT DEVELOPMENT BANK SERVES AS THE FINANCIAL AGENT OF THE MINISTRY OF FINANCE, RESPONSIBLE FOR GUIDING AND ESTABLISHING LOAN CONTRACTS WITH THE LOANING UNITS, MONITORING AND PROMOTING THE COLLECTION OF PRINCIPAL AND INTEREST TO BE REPAID TO THE STATE BUDGET TO REPAY THE COOET FUND. THE FEES OF THE VIETNAM INVESTMENT DEVELOPMENT BANK (0.3% PER YEAR) WILL BE CHARGED FROM THE INTEREST COLLECTED FROM THE LOANING UNITS. INTEREST CALCULATION IS PERFORMED TWICE ANNUALLY ON JUNE 15 AND DECEMBER 15. REPAYMENT OF THE PRINCIPAL WILL BE DONE IN 18 INSTALLMENTS STARTING FROM JUNE 1995.

9/ THE MINISTRY OF WATER RESOURCES AND RURAL DEVELOPMENT IS RESPONSIBLE FOR DIRECTING AND PROMOTING THE UNITS TO REPAY THE LOAN ON TIME.

10/ THE VIETNAM INVESTMENT DEVELOPMENT BANK MUST SETTLE ACCOUNTS ANNUALLY WITH THE MINISTRY OF FINANCE REGARDING THE USE, COLLECTION, AND REPAYMENT OF THE LOAN TO THE STATE BUDGET UNTIL THE FULL REPAYMENT OF THE PRINCIPAL AND INTEREST TO THE MINISTRY OF FINANCE.

11/ AFTER IMPLEMENTING BUSINESS MEASURES AND CREDIT SANCTIONS, IF THE VIETNAM INVESTMENT DEVELOPMENT BANK STILL FAILS TO FULLY REPAY THE FUNDS TO THE STATE BUDGET, THE VIETNAM INVESTMENT DEVELOPMENT BANK MUST IMMEDIATELY REPORT (THE REASONS AND UNITS THAT HAVE NOT REPAYED) TO THE MINISTRY OF FINANCE FOR SUBMISSION TO THE PRIME MINISTER FOR REVIEW AND DISPOSITION.

III. IMPLEMENTATION PROVISIONS:

THIS CIRCULAR SHALL TAKE EFFECT FROM THE DATE OF ISSUE. DURING ITS IMPLEMENTATION, IF THERE ARE ANY DIFFICULTIES, THE MINISTRY OF WATER RESOURCES AND RURAL DEVELOPMENT AND THE VIETNAM INVESTMENT DEVELOPMENT BANK MUST IMMEDIATELY REFLECT THEM TO THE MINISTRY OF FINANCE AND OTHER RELEVANT GOVERNMENT AGENCIES FOR STUDY AND RESOLUTION./.