Under the Decision, HNIF will be a financial institution belonging to the Hanoi People's Committee tasked with investment development and financial investment in accordance with Decree No.37/2013/ND-CP dated August 28, 2007 by the Government on the organization and operation of the local Development Investment Fund.
Hanoi People's Committee Chairman Nguyen Duc Chung handed over the decision and congratulated the members of HNIF's Board of Directors
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The Fund has legal status, charter capital, balance sheet, and a seal. The Fund’s account is opened at the State Treasury and various commercial banks legally operating in Vietnam.
HNIF’s head office is at 2 Phan Chu Trinh Street, Hoan Kiem District. Its second branch is on the second floor of the CT13A office building, Nam Thang Long Urban Area, Tay Ho District.
HNIF’s charter capital is US$220 billion.
HNIF will become an important capital mobilization channel for infrastructure construction projects in the Capital.
Hanoi needs more investment capital for development because the demand for loans, particularly mid- and long-term loans for socioeconomic development programs, is huge, while Hanoi’s budget remains limited and cannot meet the demand.
Currently, almost all mobilized funds are short-term, which is not suitable to infrastructure projects. Therefore, Hanoi Development Investment Fund has been set up by the municipal People’s Committee with an aim of attracting more mid- and long-term funds for the development of the city.
This important progress makes the management of development investment more effective and ensures investors’ trust.
In the coming time, the HNIF will increase borrowings from commercial banks in combination with its own capital to finance infrastructure projects. This form of co-operation will help the fund boost its capacity and reduce capital costs. It will be also more convenient for investors of infrastructure projects. Interest rates offered by the fund will be lower than rates offered by local commercial banks.
According to HNIF, the Vietnamese Government should establish a common legal framework so that development investment funds in localities across the nation can operate more effectively. The birth of such a common legal framework would create new momentum for the development of existing development investment funds and the establishment of new funds in other provinces and cities.
The Government also allows the establishment of associations of development investment funds in localities in order to help them co-ordinate with each other to propose new policies to improve operations.
