Large investment rates and slow product consumption put businesses in the construction materials industry under great pressure when repaying debt and interest on bank loans.
Reporting at the conference on June 15, the Ministry of Construction said that the financial situation of construction material production enterprises is still difficult because they, especially cement enterprises, invest huge capital in projects. production project.
Therefore, in the early stages of factory operation, businesses have to pay high principal and interest, leading to great pressure to repay debt, according to the Ministry of Construction.
Recently, slow product consumption has also caused many businesses to stop some product production lines. This leads to financial cash flow to repay bank debt and raw material and fuel costs for production very difficult.
“Many construction material factories, especially the cement group, produce inefficiently and lose money, leading to bad debts,” the Ministry of Construction said.
To solve the problem, Prime Minister Pham Minh Chinh assigned the State Bank to review and amend regulations on freezing, extending, and lowering bank interest rates on businesses’ debts to suit their financial capacity.
Prime Minister Pham Minh Chinh spoke at the construction materials industry conference, May 16. Image: VGP
As for businesses, the Prime Minister asked them to restructure their capital sources and reduce costs to ensure cash flow to pay bank debt and production costs. “Enterprises must flexibly use capital,” he said, emphasizing the principle of not using short-term capital for medium or long-term investments.
At the same time, businesses discuss with banks to block, delay, and have a debt repayment schedule; Use capital sources to pay off old loans with high interest rates and borrow new loans at low interest rates to reduce financial costs.
The Prime Minister also asked businesses to restructure management, finance, investment and input materials to improve product quality, efficiency and competitiveness.
“Investing in technology and equipment in depth will reduce production costs, save energy, natural resources, protect the environment, and reduce emissions,” he said, adding that this also helps increase productivity. , quality, reduce product costs.
Enterprises must review the sales agent system; cutting down on parts and intermediaries from the manufacturing plant to the consumer; Reduce appropriate selling costs. At the same time, they need to seek and expand markets and increase exports to many countries around the world.
The total annual revenue value of the construction materials industry, including cement, iron and steel, is estimated at nearly 47 billion USD, accounting for about 11% of national GDP.
The Prime Minister requested ministries and localities not to push, avoid, and focus on handling and solving the production and consumption of cement, iron and steel, and construction materials in 2024. This will contribute to socio-economic development, growth in 2024 and the following years.
In particular, the Ministry of Finance, Natural Resources and Environment and the Ministry of Construction research specific incentive policies for factories producing cement and other construction materials if they use alternative fuels from waste, and use Use alternative materials such as waste from industries such as ash, slag, artificial gypsum,… in cement production.
Ministries and branches should soon complete tax policies to encourage domestic production and limit imports. The Ministry of Construction studies trade defense and anti-dumping measures for imported tiles, sanitary ceramics and construction glass products.
The Ministry of Transport directs investors to use reinforced concrete viaduct solutions with expressway projects on the basis of careful calculations, suitable for each project and route section, ensuring efficiency. tallest.