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Banks need to make credit easily accessible to property developers and buyers, and cut costs to reduce loan interest rates, Prime Minister Pham Minh Chinh has said.

He was cited in a resolution passed at the January meeting of the Cabinet.

Real estate accounts for 11% of the country’s GDP and, being closely related to many other industries, creates a large number of jobs.

But the sector has recently faced difficulties as credit has been tightened and demand has slumped. Many projects have stalled due to a lack of capital.

Recent statistics from the Ministry of Construction show that nearly 40% of real estate businesses went bankrupt last year.

In the resolution, the PM also tasked the ministry with coming up measures to mitigate the difficulties and report to him before February 15.

Last December the PM had once called on banks to cut costs to be able to reduce loan interest rates and foster economic recovery.

He instructed the State Bank of Vietnam to get banks to speed up disbursement of loan subsidies.

In January interest rates on loans to the property sector ranged from 4.99% to 13%.

Source: VNExpress.net