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As Vietnam strives to develop its economy, many industrial goods are still being manufactured with outdated machines. This poses a risk to the environment as well as workers' health and safety. SECO is helping companies raise the capital they need with a "green credit line".
Saigon-based Tan Phu Joint Stock Company manufactures plastic products, mainly for the domestic Vietnamese market. Almost 400 people are employed with Tan Phu. Since the company was founded in 1977, however, its machinery was never updated. This created hazardous working conditions for the workers and heavy environmental pollution. Although the managers of Tan Phu were aware of the need for change, they did not initially feel in a position to take out a long-term loan for the necessary investments.
Thanks to the "green credit line", Tan Phu was able to take out a loan in 2008 and replace two compression moulding machines. Not only has this improved working conditions, it also represents energy savings of almost 600,000 kWh a year, corresponding to an annual reduction of up to 343 metric tons of climate damaging emissions. Moreover, the new technology allows for up to 20 per cent of waste products to be recycled. This means that Tan Phu needs fewer new plastic granules to manufacture its products, which improves its profitability. The company has since taken out a second loan to replace other machines, againmaking use of the "green credit line".
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