Agribank to help exporters buy 600,000 tons of rice

The central bank on Friday asked state-owned Bank for Agriculture and Rural Development (Agribank) to offer its cheapest loans to help exporters buy up to 600,000 tons of rice from local farmers.

Vietnam, the world's second-biggest rice exporter, is facing a rice glut, lower prices and reduced earnings for farmers, after it restricted exports earlier this year amid fear of a possible shortfall.

Agribank will offer loans at its “lowest lending rate” to Vietnam Southern Food Corp. and Vietnam Northern Food Corp., according to a statement on the State Bank of Vietnam’s website on Friday.

The government will pay the loans’ interest, the statement said.

Prime Minister Nguyen Tan Dung said earlier this month that Vietnam has 900,000 tons of rice in stock.

Vietnam had exported 4.39 million tons of rice, he said, adding the country expects to ship one million tons of rice abroad in the year’s last two months, raising the total export volume this year to five million tons, up about 25 percent over last year.

Higher rice shipments may help Vietnam sustain economic growth after the government pared targets for expansion this year because of surging inflation, a widening trade deficit and the global financial crisis.

Source: Thanh Nien