Curbing inflation more important than economic growth: NA

The Vietnamese Government has been urged to redouble efforts on curbing inflation to below 10 percent and shift focus away from a high economic growth target for 2012.
The call was made by many deputies said at Vietnam’s National Assembly (NA) during discussions this morning.

However, with this year’s annual inflation expected to be 18 per cent, compared to nearly 12 per cent in 2010, achieving single-digit inflation will be extremely difficult.

“It’s not necessary to raise the growth rate of Gross Domestic Products (GDP) to 6-6.5 per cent next year,” said deputy Mai Huu Tinh, who represents the southern province of Binh Duong.

“The far more important task is lowering annual inflation to less than 10 per cent.”

Vietnam’s targeted economic growth for 2012 is slightly higher than this year’s growth rate.

The country’s GDP increase this year is expected at 6 per cent, lower than the rate of 6.78 per cent in 2010. The index grew by 5.43 per cent in the first quarter, 5.67 per cent in the second quarter, and 6.11 per cent in the third quarter.

Deputy Truong Minh Hoang from the southernmost province of Ca Mau said the Government should even accept a lower economic growth next year than this year, while according to HCM City’s deputy Tran Du Lich, one-digit inflation is “the number one target”.

“If two-digit inflation continues in 2012, all the economic achievements the country has gained during many years will vanish into thin air,” said Lich.
The Consumer Price Index reached its peak this year in April, and has since declined gradually.

Deputy Mai Huu Tinh said most small and medium-sized enterprises are now close to shutting down.

“They won’t be able to survive long if interest rates stay above 15 per cent per year and inflation over 10 percent,” he said.

The high rate of inflation and interest rates has resulted in massive bankruptcy of small and medium-sized businesses, a sector that account for 95 per cent of enterprises in Vietnam.
Vietnam News

Tags: Vietnam economic, Vietnam economic growth, Vietnam economy, Vietnam economy 2011, Vietnam inflation, Vietnam inflation 2011