About Supporting People to Access Credit Capital Conveniently

There is a new class of “landlords” and “tenant farmers” in the countryside because we have a strong political system at all levels. We have many other sanctions to prevent this negative situation such as high taxes on those who have a lot of land but do not directly produce; confiscation and expropriation of land when there is an act of land lease and rent collection. The important thing is that local authorities must be determined to prevent the formation of a new class of landlords. In the current industrial age, if a new landlord is formed, it will be under the guise of a private agricultural enterprise owner.

- Regarding the 50-year land allocation term, it is also necessary to clarify which agricultural areas are of national strategic importance and food security, and which should be allocated for a long term. Those who are actually farmers who cultivate and use land effectively should boldly allocate land for a long term. To encourage commodity production, it is necessary to study each area, what scale is allowed to be allocated for 50 years, thereby promoting land concentration. It is necessary to link this policy with encouraging land concentration, promoting commodity production, increasing added value and sustainable development of agricultural production. In principle, the longer the land is allocated, the more stable and effective the agricultural investment will be, in terms of irrigation infrastructure, electricity, roads, production investment, and investors will feel more secure in investing. However, it is necessary to manage tightly, creating fairness in land use. The extension of the agricultural land allocation term must also be calculated to create fairness in land use, avoiding the situation where those who need it do not have it, and those who have it do not need it. In cases where land is not used or land is leased, there must be a certain policy to handle it in order to create fairness in land.

- Respect the interests of farmers in land acquisition compensation. Land acquisition for industrial development and to meet the needs of urbanization is inevitable in the development process. However, it is necessary to ensure the interests of all parties, especially the interests of people whose land is acquired, ensuring that those whose land is acquired can restore or improve their living standards compared to before the land acquisition. It should be calculated in the direction that when the State acquires land, whoever uses the land afterwards will be responsible for compensation. The compensation level for site clearance is implemented according to the principle of ensuring that people have a life equal to or higher than their old place of residence. For rural people, it is necessary to calculate fully, in addition to compensation for land use, there must be compensation for crops and assets on the land. In land compensation, many measures need to be taken so that people feel

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respected and benefited when they had to give up their land for government projects. During the land acquisition process, people must have the right and obligation to “interact” with local authorities, thereby monitoring those who carry out the appraisal, compensation and resettlement processes.

- Calculating land prices according to market prices. Currently, there is still a big difference between “state-regulated land prices” and “market prices” - this is the cause of major obstacles in the land market. This two-level price system can bring great values and benefits to real estate development enterprises (usually state-owned enterprises), investors and speculators. In addition, allocation decisions, joint venture transactions, investment fees and taxes are often based on artificially devalued land values; this means that the Government is damaging the interests of the people by lowering the value of one of the most valuable assets owned by the people.

Second, perfecting the theoretical basis, practical models and mechanisms for farmers to contribute capital using land use rights value to work at the place of capital contribution.

The goal of this approach is to ensure that agricultural workers whose land has been recovered, although they no longer have the basic conditions to continue agricultural production, still have the economic basis to maintain their position as self-employed workers, to change their occupation from agricultural labor to industrial or service labor, and to have a stable and sustainable life. Agricultural workers whose land has been recovered have the right to contribute capital to the company with the value of their land use rights at a reasonable price in each period as determined by the State for each region close to the actual market price. The value and number of shares of infrastructure investment and business enterprises or other types of enterprises assigned to farmers are equal to the actual land use rights value of each household handing over land to the company or enterprise. Along with the right to contribute capital, agricultural workers whose land has been recovered must be supported with vocational training and accepted to work at companies and enterprises in which they contributed capital, especially workers under the age of 40. For older leaders, they must participate in appropriate service activities. As for those who are no longer of working age, they must continue to cultivate the remaining land and rely partly on income from dividends.

In case farmers do not want to contribute capital in the form of land use rights but want to receive compensation to make other investments, the shares will be converted into cash according to the value of the shares to be transferred to the development investment fund to help farmers change their investment direction according to their strengths. This will be a measure to help farmers use the compensation money, support career change, stabilize their lives effectively and sustainably in the process of developing the country in the direction of socialism.

Third, speed up the implementation of the "land consolidation and plot exchange" policy to have large fields, creating a foundation for the development of modern commodity production.

Focus on doing a good job of propaganda and mobilization so that people are properly aware of the role and importance of land consolidation and plot exchange, thereby actively responding and participating. It is necessary to implement the principles of publicity, democracy, fairness, equality and voluntariness, in which the team of cadres and party members in the communes must be exemplary pioneers in implementing land consolidation and plot exchange. Strengthen inspection and control work in implementing land consolidation and plot exchange to promptly correct errors and deviations, ensure timely and effective implementation, and at the same time detect and handle organizations and individuals who take advantage of policies and guidelines to violate the law and grassroots democracy regulations.

Focus on providing capital, technical assistance and markets... to households and areas of land consolidation and plot exchange so that production efficiency in those places is much higher than in areas of fragmented land to create attraction and change people's thinking about land consolidation and plot exchange. At the same time, it is necessary to do a good job of planning to form stable and long-term production areas for each crop and animal. Relevant departments and agencies need to develop a master plan for land types, natural conditions and climate of each region. On that basis, localities should study and develop detailed and specific plans for the use of each type of land suitable for each type of crop and animal to have a scientific land consolidation and plot exchange plan, suitable for practical conditions and agreed by farmers, avoiding causing unfortunate losses to farmers.

The larger the land area, the more closely production must be monitored to limit risks and ensure linkages in production. For farmers and agricultural enterprises that do not comply with the conditions for granting production licenses on a large scale, the State can revoke the production license and organize a bidding process for other farmers and enterprises to buy it back.

4.2.1.2. On supporting people to access credit capital conveniently

Investment capital in agriculture is highly risky, disbursed capital is small but monitoring costs are high, while on the farmers' side, due to complicated lending mechanisms and procedures and some areas have long capital recovery periods. Therefore, credit institutions are not active in lending capital to farmers for production. Meanwhile, most farmers in our country have low savings levels, if they cannot borrow capital, it is difficult to expand production scale, difficult to invest in intensive farming, modernize production or replace new varieties. Therefore, the State needs to actively support farmers to have convenient access to capital sources.

First, expand credit to farmers.

The State Bank of Vietnam needs to study and continue to be more flexible in some mechanisms to encourage commercial banks to compete in expanding lending to the agricultural and rural areas, such as: required reserve ratio, refinancing loans, using capital mobilized in the secondary market... At the same time, continue to have more specific measures to encourage credit institutions to compete and expand their network of operations in rural areas. The State Bank discussed with the Ministry of Finance and submitted to the Government that there should be a more proactive mechanism on capital sources for the Vietnam Bank for Social Policies to expand policy credit programs and expand lending to near-poor groups in rural areas. In addition, there should be a mechanism on policies and capital sources so that the grassroots People's Credit Fund system in rural areas in general can access refinancing channels (such as the Bank for Agriculture and Rural Development), as well as entrusted capital sources and capital sources of other projects.

Encourage the full exploitation of capital sources entrusted from international financial institutions, foreign banks, and non-governmental organizations through projects signed by the Bank for Agriculture and Rural Development. This is a source of capital that is often invested in development projects by type of tree, animal, or by region or sub-project. Foreign capital sources are stable over a long period of time, very suitable for the need for medium and long-term loans to serve the industrialization and modernization of agriculture and rural areas, which require a lot of capital with low interest rates and a long period of time, suitable for those who need to invest in farm economics.

Building credit organizations for farmers. Currently, farmers mainly borrow capital from banks. But borrowing from banks is not easy, and interest rates are also high. Many farmers still have to borrow high interest rates outside the banking system. Therefore, to support farmers in

In order for the agricultural restructuring process to be effective, it is necessary to build a farmers' credit organization. This credit organization is established by farmers who contribute capital and then lend to the farmers themselves, and the interest earned is divided among the farmers (of course, the loan amount and interest are practical, close to the farmers' conditions). From there, it will end the "black credit" problem in rural areas. In addition, it is necessary to have a cooperative organization to support farmers so that they do not have to swim alone anymore. Through this cooperative organization, investors and businesses invest in financing in the form of lending capital to farmers for production. Some businesses even advance money to farmers so that they can make products and then buy them back through the cooperative.

Second, diversify credit products for farmer customers.

Diversifying credit products of the rural financial intermediary system also helps farmers access credit sources easily and effectively. To achieve that, it is necessary to:

Combining many flexible lending methods such as investment project lending, credit limit lending, etc. to help borrowers be more proactive in using capital in accordance with the production cycle in agriculture, minimizing loan procedures, saving indirect costs when accessing bank capital. In particular, developing financial leasing credit in the agricultural and rural sectors. Expanding the rural financial leasing market to overcome limitations in loan collateral (loans do not require collateral like bank loans). Financial leasing activities help production households invest in renovating equipment and technology with large capital scale, medium and long-term leasing period (5 - 10 years) to meet capital needs, implementing agricultural and rural mechanization.

Developing a loan product for agricultural marketing activities for farmers with consumable goods, joint investment groups and agricultural cooperatives with farmers' capital contributions. In terms of purpose, this credit product supports the above subjects to have conditions to store agricultural products after harvest, carry out marketing and sell those products at a certain price to ensure stable output and increase income for farmers. The loan term is from 3 to 6 months after harvest, with interest rates according to bank regulations. The main collateral is agricultural goods. Financial intermediaries use the warehouse record as a loan document or can choose to authorize a unit.

Warehouse business storing goods pledged under a three-way contract. Goods are only released upon acceptance by financial intermediaries.

Developing alternative financing methods for collateralized credit for all customers can provide alternative forms of collateral to reduce dependence on tangible collateral with low liquidity and insufficient legal value, while guiding banks to accept safe and liquid collateral. Loan terms and interest rates are similar to other forms of lending. For this form of lending, financial intermediaries need to pay attention to types of collateral that can replace land and assets attached to land such as letters of guarantee, letters of credit, purchase orders, sales contracts, agricultural product purchase agreements, warehouse receipts, and guarantees from lending organizations. Financial intermediaries analyze the legal nature of these alternative forms and propose methods to determine the value of such forms as goods and real estate when these forms are used to replace collateral.

Third, perfecting the agricultural insurance program to truly become a "support for farmers"

Vietnam is an agricultural country, with 70% of the population living in rural areas. Recently, each year, natural disasters and crop and livestock diseases have caused Vietnamese farmers an estimated loss of 13 to 15 trillion VND. Meanwhile, the annual state budget only allocates 200 to 400 billion VND (excluding local budgets) to support farmers in dealing with epidemics. However, this is only the minimum expenditure and has not helped farmers recover and compensate for production costs. Therefore, applying agricultural insurance (AIF) will become a lifesaver for farmers when they encounter risks in production. However, the pilot implementation period of AIF, in addition to the achieved results, still has many problems. The agricultural sector itself contains many difficulties and risks, depending largely on difficult-to-control factors such as weather and climate. On the other hand, farmers are still poor, have small-scale and fragmented production practices, and have limited habits and experience, so agricultural insurance will also face many difficulties and risks in the near future. Thus, the problem for this special type of insurance is that it needs a suitable support mechanism from the State to hope for effectiveness. For agricultural insurance to develop further, there are some solutions as follows:

Widely disseminate the benefits of agricultural insurance policies for farmers. The biggest difficulty in implementing agricultural insurance at present is how to make farmers understand the incentives they enjoy, their rights when participating in insurance with the almost maximum support of the Government to attract the majority of participants. In our country, agricultural insurance is a new policy, not only farmers - the subjects of insurance participation but also insurance enterprises, advisory agencies for the State, leaders at all levels and local social organizations have not yet recognized and understood thoroughly. Therefore, in the immediate future, it is necessary to provide information in a complete, transparent, specific and easy-to-understand manner about this type of agricultural insurance in many forms. Localities need to establish steering committees and working groups to organize and guide farmers to easily access agricultural insurance, need to fully inform them about what agricultural insurance is, why they need to participate, what the procedures are and which agencies can provide advice and assistance; What are the conditions for insurance compensation?

Insurance companies provide insurance products that meet some of the following conditions: Products need to be simple, easy to understand, easy to remember, suitable for farmers' awareness and level; Practical insurance coverage; Low insurance premiums, payment methods suitable for farmers' income and habits; Insurance participation and compensation procedures need to be simple and quick.

Building a separate policy mechanism for sustainable agricultural insurance. To do that, it is necessary to have the participation and interest of insurance companies, all levels, sectors and the whole society. Therefore, it is necessary to build a separate policy mechanism for agricultural insurance including: supporting people; supporting businesses; the State accepts reinsurance for enterprises doing agricultural insurance business; Research the risk levels for each subject and each region to have appropriate insurance development policies: the motto is to go from easy to difficult (choose subjects with the same risk level, moderate level, simple and easy-to-implement insurance products, choose easy-to-control risks, etc.), and finally apply the diversification of insurance forms, index insurance and insurance according to traditional methods, etc. However, the support must be sustainable, oriented, increase the initiative of farmers, not the current "patchwork" method of dealing with the consequences as the damage occurs. For example, the State both supports open policies for businesses and invests in science and technology for farmers; puts insurance companies in an intermediary position, selling services to

Farmers. When natural disasters, epidemics... lead to damage, the insurance will cover a part according to the registered liability capacity, the rest will be taken care of by the State.

Creating consensus between people and insurance companies. The process of piloting the agricultural insurance program has raised some problems. Insurance companies complained of losses and delays in compensating farmers because they believed that some households showed signs of profiteering through insurance compensation. Households and agricultural production organizations still participated tentatively (participating little or not at all), or selected high-risk insured subjects to participate. Insured farmers said that insurance companies tried to make it difficult for farmers to compensate, even suspending insurance contracts due to fear of risks... This confusion made the meaning of the agricultural insurance pilot not achieve the desired results. Agricultural insurance is essentially a good policy, but to be successful, it needs support from the people. On the business side, it is possible to replicate the form of insurance premium collection of Bao Viet Insurance Corporation, Dong Do Insurance Company... which allows premium collection in multiple installments to create conditions for livestock owners to participate in insurance. This is a creative way and attracts the attention of the people. At the same time, it is necessary to actively and proactively speed up the review and settlement of compensation claims, coordinate with local steering committees and competent agencies to confirm damage, specifically determine the type of epidemic, the extent of loss and promptly resolve compensation for insured people to restore production and business activities.

Implementing well the work of risk monitoring and preventing insurance fraud to ensure the meaning and sustainable development of the agricultural insurance program. If the local agricultural insurance steering committee and insurance companies do not pay attention and enhance their role in the work, and at the same time, people do not fully understand the principles and procedures of insurance, leading to prolonged complaints and questions, it will significantly affect the implementation process on a large scale. And the first to suffer are farmers because they are not guaranteed if risks occur. Along with the efforts of the Government, relevant levels, sectors, and insurance companies in preventing the motive of agricultural insurance fraud, it is also necessary to have the cooperation of agricultural insurance participants in raising awareness of agricultural insurance. Agricultural insurance is essentially mutual insurance and the pilot implementation is also for the purpose of stabilizing and developing the industry as well as people's lives.

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