SBV asks commercial banks to support fuel traders

VIETNAM, November 11 – HÀ NỘI — The State Bank of Việt Nam (SBV) has issued a document ordering commercial banks to take all measures to support fuel traders.

SBV underscored the importance of fuel as a key product with a direct and significant influence on the country’s macro-economic stability and people’s daily lives, the document said.

Since the beginning of the year, SBV has been working closely with commercial banks to extend lines of credit to fuel traders and provide them with favorable exchange rates.

As the global oil price continues to be volatile and the market faces supply disruptions, the government of Việt Nam has made it a priority to ensure a stable supply to the domestic market.

The central bank needed to implement financial support policies to best support fuel traders in accordance with the regulations. Traders have been advised to stay in close contact with commercial banks to plan ahead for their financial needs.

Meanwhile, banks were to conduct comprehensive reviews to stay on top of the situation in a bid to streamline the process to ensure merchants’ financial needs are met in a timely manner.

The central bank is awaiting monthly reports from commercial banks on how and when they plan to support traders, including retailers and importers who have been encouraged to report to the SBV if they encounter any problems or delays.

During a discussion in the National Assembly, Minister of Industry and Commerce Nguyễn Hồng Diên said that central bank support should play a crucial role in strengthening the financial capacity of traders and mitigating of the current fuel shortage across the country.

The National Assembly (NA) tasked Diên and his ministry with coming up with a plan to establish a stable fuel supply and efficiently operate the country’s fuel network.

Early last month, Finance Minister Hồ Đức Phớc proposed giving the Ministry of Industry and Trade (MoIT) full authority to adjust fuel prices, instead of the current joint authority between the MoIT and the Ministry of Finance. Phớc said it would help streamline procedures and increase fuel management efficiency.

Some industry experts have voiced support for the minister’s proposal, saying it could end the recent backlash between the two departments. Furthermore, the MoIT, which currently oversees fuel trading and retailing activities, was in a much better position to propose a price adjustment mechanism that balances the rights and benefits of traders and consumers.

“The proposal reduces the workload of the Ministry of Finance. Moreover, it is logical that the ministries which are in charge of adjusting the prices of certain products,” said NA MP Trần Văn Lâm, member of the NA finance and budget committee.

A number of petrol stations have closed in recent weeks, with traders citing numerous difficulties in securing stock and suffering heavy financial losses since the start of the year. —VNS

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