Fishermen are desperate for capital.

(Baonghean) - Building new, large-capacity fishing vessels to venture further offshore is the dream of fishermen and also a policy that the State has encouraged in recent times. However, due to a lack of capital, fishermen are eagerly awaiting more active and practical support from the State's loan policies so that they can confidently continue fishing, improve their lives, and contribute to mastering the country's maritime territory.

High demand

Mr. Nguyen Van Hoang (Tien Thuy commune, Quynh Luu district) said: Fishermen aspire to build large, high-capacity ships to venture further out to sea, stay at sea for extended periods, improve their lives, and protect maritime sovereignty, but they lack capital. Nearshore fishing grounds are depleted, so to do big business, they must venture further out to sea. To do so, they need large ships with engines of 600 horsepower or more, costing between 4 and 5 billion VND; modifications require at least 200 million VND depending on the weight and engine capacity... Mr. Hoang currently owns a ship with a 270 horsepower engine, but it can only stay at sea for 2-3 days before returning because the engine is too small and the fuel is insufficient to go far out. Normally, each trip yields about 5 tons of fish, sometimes up to 10 tons. However, high fuel prices, high costs, and the fact that most of the fish are low-value, mean his income is minimal. He often considered building a new ship to have better opportunities to go out to sea and change professions, but the thought of the 4-5 billion dong needed discouraged him.

Fishermen need capital to build new ships to venture further out to sea, develop the economy, and participate in taking ownership of the nation's maritime territory.

Near the Lạch Quèn fishing port, the 800 HP vessel owned by Mr. Hồ Sửu (Hamlet 3, Quỳnh Nghĩa Commune, Quỳnh Lưu District) and his nine crew members is being urgently completed. He plans to launch it and make his first voyage in July of this year. However, his main concern is securing the necessary capital, as the bank has yet to approve his and his crew's loan. He explained that building this vessel requires at least 5.5 billion VND for the hull, machinery, and fishing gear. With ten people contributing, each person is expected to contribute 550 million VND, but so far only a little over 2 billion VND has been raised. Occasionally, someone contributes a few tens of millions more, and the funds are gradually being added. He has also submitted an application, mortgaging his land title to borrow 2 billion VND from the Quỳnh Lưu branch of the Agricultural Bank, but it has not yet been approved.

It must be acknowledged that the current capital needs of fishermen are very high. Of the province's total of over 4,000 fishing vessels, only about 1,100 have a capacity exceeding 90 horsepower (HP), and approximately 260 have a capacity exceeding 400 HP. Furthermore, over 95% of fishing vessels in the province are made of wood, use old engines, and lack proper preservation equipment to ensure the quality of seafood for processing and export. Consequently, post-harvest losses reach 25-30%. Despite the rapid development of the fisheries industry, the fact that two-thirds of the province's fishing vessels are small in capacity poses significant challenges. This puts pressure on the inshore waters (near-shore seas) in the process of protecting marine resources.

One of the main reasons is that fishermen lack the initial capital to invest in building new ships and equipping them with the necessary fishing gear for long voyages at sea. However, building large-capacity vessels requires capital, but access to bank loans is difficult. Mr. Dam Phi An, a fisherman from Tien Thuy commune (Quynh Luu district), said: "Fishermen always want to build large ships to venture further out to sea and explore new fishing grounds. But bank loans are too limited, and the procedures are complicated. Poor fishermen, whose only collateral is low-value houses and land, are only allowed to borrow about 30% of their value. Because access to banks is difficult, many fishermen have chosen to borrow from middlemen or take out high-interest loans to acquire ships, fuel, or to renovate or build new ones. Although everyone knows the consequences of this choice are compounded interest and middlemen forcing down the purchase price of their products..."

"Quenching the thirst" for fishermen

Mr. Ho Cong Dam, Director of the Agricultural and Rural Development Bank branch in Quynh Luu, said: "Although risks in the fishing industry are always present, the risk rate is decreasing day by day. This is due to fishermen investing in larger boats and more powerful engines, coupled with timely weather forecasts, so the bank is still confident in lending capital to fishermen. For families with substantial assets, loans are 200 million VND, while for ordinary households, loans range from 100 to 150 million VND per household. By the end of 2013, the total outstanding loan balance of the bank was 815 billion VND, of which 50% was lent to fishermen for building new boats. In the first three months of the year alone, the outstanding loan balance increased by 86 billion VND (accounting for 10%)."

However, Mr. Dam also affirmed that the demand for loans from fishermen is still very high, but banks cannot meet it all because they have to base their lending on mobilized capital and assigned targets. “Currently, fishermen borrowing less than 50 million VND do not need collateral. If they borrow more, they must meet certain conditions: collateral, financial capacity, loan capital needs, and project feasibility. Bank credit officers will balance these conditions to determine the amount of capital for each individual. Fishermen mainly borrow medium-term capital, while the medium-term loan quota has been specifically regulated compared to the total outstanding loans of the branch; we are not allowed to lend beyond that ratio.”

Another reason why many banks are hesitant to lend to fishermen is that many boats are currently uninsured, and many fishermen are not enthusiastic about purchasing crew insurance. Meanwhile, banks need to balance their mobilized capital to lend to fishermen. If fishermen have insurance, banks feel more secure in lending. However, in Quynh Luu district and Hoang Mai town, very few fishermen purchase relevant insurance. Mr. Hoang Van Xuan, a fisherman from Quynh Nghia commune, said that when the government provided financial support for insurance, people were enthusiastic, but when that program ended, they lost interest. Furthermore, the workforce at sea changes frequently; some work today, some don't, and despite propaganda and encouragement, no one seems to buy insurance. What Mr. Xuan said reflects the thinking of many fishermen in our province.

Currently, according to the province's general support policies, to address the difficulties faced by fishermen, there is an annual program to subsidize post-investment interest rates for newly built vessels exceeding 90 horsepower. According to Mr. Nguyen Chi Luong, Head of the Fisheries Exploitation and Protection Sub-Department: Compared to the value of a vessel, which can reach 4-5 billion VND, the amount of post-investment interest rate subsidy is insignificant. Therefore, the support is mainly for encouragement purposes. The province also regularly provides funding for building models to facilitate the transition of fishing occupations from inshore to offshore areas; funding for training captains, engineers, and crew members of fishing vessels; and support for long-range communication equipment for fishermen... However, the funds for post-investment interest rate subsidies for fishermen are still insufficient, even the support for 2010 and 2011 is still lacking. The Department of Agriculture requested additional funding to support interest rates on the construction of new offshore fishing vessels, but to date, the relevant authorities have not yet allocated the funds for the unit to disburse to eligible beneficiaries as stipulated.

With a vision extending to 2015 and 2020, our province aims to develop a fleet of fishing vessels with a capacity exceeding 300 horsepower, fully equipped with modern equipment to ensure long-distance, long-duration offshore fishing. Simultaneously, we aim to gradually reduce the number of small vessels engaged in near-shore fishing. The total investment required is 2,790 billion VND, of which 1,324 billion VND is for the 2011-2015 period and 1,460 billion VND for the 2020 period. However, specific solutions regarding funding have not been outlined. Meanwhile, what fishermen need most is access to capital through various support mechanisms and channels to invest in building new offshore fishing vessels. This solution, however, remains vague and lacks high feasibility. To enable fishermen to venture further offshore and prosper from the sea, banks need to continue supporting them and resolving obstacles related to access to funding. In addition, along with the involvement of central ministries and agencies, the province needs to proactively develop support programs for fishermen. Because investing in fishermen is not only an investment in economic development but also a way to contribute to protecting the country's seas and islands alongside them.

Text and photos:Pham Bang