Procedures

financial intermediaries

Initial phase
The process initiates with the interest of the company to put into consideration of Green Credit Line (GCL) a project of environmental investment. In the initial phase, the next activities are developed:

  • In the first step, the interested company has to apply to the Green Credit Line. It has to fill in the GCL project form, which has the purpose to define the project, the investment amount, the (expected) environmental impact, the technology to be used, and the cash flow of the project. The company may seek for support from engineering companies or from the equipment supplier, to fill the project form.
     
  • Once the project is formulated, the company can send the formdirectly to the Vietnam Cleaner Production Centre (VNCPC), or to the financial intermediary of its choice. If it takes the second alternative, the financial intermediary will send the project format to the Centre.
     
  • Within 15 days after receiving the project, the Centre will emit a preliminary appraisal about it, after a quick assessment. A positive appraisal does not mean a credit approval, and the incentive grant. It is just an initial filter to avoid companies to go further if the project is not viable or if it does not fulfil the general requirements. In the first step, based on the information given by the company, at least 30% environmental reduction is required, which means that the project will be a potential beneficiary of the reimbursement.
     
  • In case of a positive preliminary appraisal made by VNCPC, it will send a communication to the financial intermediary (chosen by the interested company).
     
  • The Financial Intermediary will study the project and the company's situation from a financial point of view, and will emit an appraisal on the potential eligibility of the client as credit subject. Equally, this concept does not represent a commitment from the Financial Intermediary that it will approve the Credit.
     
  • If the company obtains the positive preliminary appraisal of both VNCPC and the Financial Intermediary, VNCPC will elaborate a technical and economic offer to perform the Detailed Evaluation of the Project, and the necessary laboratory measurements before and after the implementation of the project.
     
  • Finally, the interested company evaluates and agrees or rejects this offer.

 

Evaluation Phase
Once the preliminary positive appraisal from VNCPC and the financial Intermediary has been received, and once the company as agreed on the offer from VNCPC to perform the Detailed Evaluation and the measurement of the indicators, these activities will follow:

  • Detailed evaluation by VNCPC: Review of relevant environmental aspects according to ISO 14001 procedures , evaluation of the proposed technology, calculations of the environmental impact of the main indicator and others affected, and economic evaluation of the project. The results of this evaluation can be negative, even if the preliminary concept was positive. In such case, the respective adjustments will be requested to the company, and / or the project will be rejected. In a positive case, VNCPC informs the Financial Intermediary in order that it can proceed with the Credit study.
     
  • Study of the Credit by the Financial Intermediary: Analysis of definitive credit, constitution of guarantees, elaboration of contracts, and disbursements as agreed with the company.

 

Implementation Phase

  • Once the credit contract is signed between the company and the Financial Intermediary, but before beginning the implementation of the project, the real measurements of indicators is realized by VNCPC: Measurements before implementation of the main indicator and others that can be potentially affected (measurements ex-ante).
     
  • Then, the company proceeds with the implementation of the project
     
  • When the implementation is finished, VNCPC performs an economic evaluation to assure that the money from the credit was correctly invested in the project. It informs the Financial Intermediary in order to take the appropiate measures.
     
  • In the 3 to 6 months following the date of implementation of the project, VNCPC performs again the measurement of the indicators (ex-post). This period is established to guarantee that results are stable.
     
  • With the measurements, ex-ante and ex-post, VNCPC defines the recommendation of reimbursements to seco.
     
  • seco arranges the transfer of the reimbursement to the financial intermediary, as prepayment to balance.

 

The remain of credit conditions agreed between the company and the Financial Intermediary will operate normally since the beginning of the credit up to its conclusion.