Plan to build rice warehouses progressing slowly
Plan to build rice warehouses progressing slowly
Though begun in late 2009, many projects under the plan to set up a warehouse system capable of storing 4 million tons of rice in the Mekong Delta have so far gone no further than the initial stages, despite the coming summer-autumn crop.
The People’s Committee of An Giang Province has approved investment for a 623,000-ton warehouse in the locality, attracting registers from 18 businesses, which pledged to implement 66 projects to build warehouses capable of storing 489,000 tons of rice.
The Vietnam Southern Food Corporation (Vinafood 2) was also in charge of similar projects.
However, two of Vinafood 2’s subsidiaries, in charge of completing a project in the My An industrial cluster in Cho Moi District, have recently said they will not be able to implement the project, as site clearance and compensation have yet to be done.
Although the companies have compensated the local authorities VND20 billion in advance, the construction still has to be relocated, according to Vinafood 2 deputy CEO Nguyen Ngoc Nam.
As for the 18 businesses which have registered with An Giang authorities, only the An Giang Tourism JSC has finished construction on its 15,000-ton warehouse, while Phu Vinh Food Co has only completed one of its two registered projects.
“Some projects have only finished site clearance tasks, while some have never had any work done,” said Doan Ngoc Pha, deputy director of the provincial Department of Agriculture and Rural Development.
“Four businesses are waiting for bank approval to access loans for starting the projects.”
Similarly, only four out of eight local businesses have completed their warehouse projects. The newly-built warehouses can store some 54,000 tons of rice, compared to the 269,000 tons registered.
Capital problems
According to the Vietnam Food Administration, the total capacity of newly-constructed rice warehouses in the Mekong Delta is only 1 million tons, while the target figure is 2.5 million tons.
VFA attributed the tardy progress to the fact that many businesses, after registering for the plan, failed to access loans.
Meanwhile, many localities also delayed approval for the projects.
Currently only An Giang, Kien Giang and Soc Trang provinces have approved the construction plans and assigned projects to businesses.
Out of the 18 businesses signing up for the plan in An Giang, only the Thinh Phu Co has disbursed VND190 billion out of the VND240 billion it borrowed.
Four other firms are waiting for approval from the Bank for Agriculture and Rural Development to access loans.
“Some have had their loan applications approved, but become hesitant when they see the lending interest rate of 14.4 percent a year,” said Pha.
The government has recently accepted the proposal to delay the plan until the end of next year, VFA said.
It also urged competent agencies to assist businesses in obtaining capital to implement their projects.
“Moreover, if Vinafood 2 cannot appropriately handle its registered projects, the government should call for participations from other economic sectors,” VFA said
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