Page 504 - Ebook HTKH 2024

managers, to experts, engineers and workers, from the province, to the district, to the
commune and workers

Second, there needs to be specific, appropriate and practical policies to encourage
textile and garment enterprises to invest in the circular economy.
In terms of mechanisms and policies, the top priority is to perfect the legal
environment: including issuing complete, synchronous and timely legal documents
towards encouraging circular economic development. In particular, legal documents
fully reflect the zero carbon commitments by 2050, commitments to combat climate
change, on the use of renewable energy and the implementation of FTAs, including the
textile and garment sector.

The Government needs to propose to the National Assembly to reduce corporate
income tax for textile and garment enterprises investing in the circular economy. In
addition, the Government needs to form a preferential credit package according to two
options:
- Option 1: Through commercial banks, lending at preferential interest rates,
equivalent to the lending interest rates of the Vietnam Bank for Social Policies (VBSP),

supporting Vietnamese enterprises to invest in projects and items of the circular
economy and the renewable economy. The credit package should be at least equivalent
to the VND 120,000 billion credit package for social housing loans currently being
implemented. This option has the advantage of taking advantage of the large number of
customers who are textile and garment enterprises nationwide, taking advantage of the
network of commercial banks, taking advantage of the loan appraisal capacity of
commercial banks, as well as controlling cash flow and debt collection because

enterprises open main payment transaction accounts at those commercial banks.
- Option 2: Form a new credit program: “Circular economic loans for textile and
garment enterprises” and expand it to footwear enterprises. The government annually
balances credit capital sources for this program. Advantages: concentrating preferential
credit on one source, convenient for budget management, preferential capital settlement
management. Of the two options mentioned above, option 1 should be prioritized.

Because in addition to the advantages mentioned, when lending to textile and garment
enterprise projects, commercial banks can integrate the green credit component into the
overall new investment project of the enterprise, or a separate green credit project of the
textile and garment enterprise.
On the local side, it is recommended that the Provincial Party Committee, City
Party Committee, People's Council and People's Committee of the provinces and
centrally-run cities need to have specific Resolutions and decisions on the Circular
Economy Development Program in the locality, with specific support policies for textile,

footwear and agricultural processing enterprises. In the annual provincial budget savings
transferred to the Social Policy Bank according to Directive 40-CT/TW dated November
22, 2014 of the Party Central Committee on strengthening the Party's leadership over
social policy credit, the provinces and cities need to allocate 50% of

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