Vietnam Govt targets 2012’s CPI below 10pct

The Vietnamese government has set its goal of containing consumer price index (CPI) rise in 2012 to below 10 percent, according to a recent meeting.
Vietnamese government said at a recent regular cabinet meeting that its overall goal for 2012 is to continue to focus on curbing inflation, stabilizing the macro economy and achieving a reasonable growth associated with growth model renewal and economy restructuring.

The government also oriented some key socioeconomic indicators for 2012 with gross domestic product (GDP) growth at 6.5 percent, trade deficit and state budget deficit at lower than the actualized targets in 2011.

In 2011, trade gap target was below 16 percent of the export turnover and state budget deficit at less than 5 percent of GDP.

From now to the year-end, the government will direct the State Bank of Vietnam (SBV) to continue its close and flexible monetary policy in accordance with the market signs, gradually lowering the credit interest rate along with the downtrend of CPI and regulating credit growth at below 20 percent.

The central bank will also have to cooperate with Ministry of Public Security and related agencies to manage and control trading activities of gold and foreign currency.

The Ministry of Finance has been assigned to continue the tightening fiscal policy together with SBV’s close monetary policy to reduce budget deficit and save by 10 percent of frequent expenditures for the 9 remaining months in the 2011 fiscal year’s estimate.

The government also assigned the ministries of planning and investment and finance to complete the evaluation report on the socioeconomic situations in the first eight months and the whole year 2011, socioeconomic development planning in 2012, assessment report on the state budget in 2011 and state budget estimate in 2012, to submit to the National Assembly.

September’s CPI rise to slow down

Vietnam’s CPI in September is expected to slow down, reaching about 1 percent, thanks to the decline in price of some commodities, especially the reduction of 500 dong per liter of gasoline recently, according to economist Vo Tri Thanh.

The reduction of gasoline price will also help CPI fall by 0.21 percent, of which, it helps the CPI decrease directly by 0.07 percent.

In September alone, the fall of gasoline price will help the CPI decrease by 0.04 percent because as prescribed, the 15th day of month will be the closing day to calculate the CPI.

Therefore, the fall in gasoline price will make stronger impacts to the CPI in October, Thanh said.

Economist Le Dang Doanh, on the oher hand, said that the slowdown of CPI in September would be attributable to the decline in price of foodstuff, food and drinks.

Though the reduction of gasoline price is not the main cause, the country’s CPI in September will rise around 0.7-0.9 percent and the rise will be maintained at below 1 percent in the next months if the price of gasoline in both local and global markets remains stable, Doanh added.

Thus, the country’s CPI for the whole year would rise 19-20 percent, he said. – Tuoitre

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