Vietnam’s credit growth has reached just 5.33 percent as of the end of August, The Investor is reporting. This is slightly up from July’s 4.56 percent but substantially far away from the 14 percent target for the year.
Consider this: The article notes that businesses are reluctant to borrow and that this may be because interest rates are too high. However, it’s worth noting interest rates have come down a number of times this year, and the credit growth limit for 2022 was reached in October of that year–this would suggest interest rates might not be the problem. What’s more likely, is that businesses don’t need the money because they are no longer growing or cannot access loans because they already have too much debt. It was suggested earlier this week that demand side stimulus may be needed and this would seem to be a rational next step.