Vietnam to balance inflation control and growth

Prime Minister Nguyen Tan Dung has said for the rest of the year, Vietnam would continue to tighten monetary policy while allowing room for growth.

At the regular cabinet meeting held in Hanoi from August 30 to Sept. 1, PM Dung emphasized the need to pursue a tightened monetary policy as well as policies to support small- and medium-sized enterprises and rural and agricultural areas.

He requested a focus on controlling prices of essential commodities to ensure the balance of supply and demand and prevent price hikes of food, foodstuff and petrol.

At the same time, he said Vietnam must also continue to work to remove difficulties in production and concentrate investment into urgent projects, especially power generation.

He proposed the Ministry of Planning and Investment seek cabinet members’ opinions before completing reports on the implementation of the socio-economic development plan in 2011, orientations for 2012 and main tasks of the five-year 2011-2015 socio-economic development plan.

On orientations for 2012, PM Dung proposed closely following the set targets, including a GDP growth of around 6.5 percent, inflation below 10 percent, a trade deficit of less than 13 percent, a reduction in the poverty rate by 2 percent and job generation for more than 1.6 million workers.

Ministries and localities should implement solutions together, particularly in monetary and financial regulations, investment in agriculture and economic restructuring, he said.

He also asked ministries not to adjust the overall targets of the 2011-2015 plan, saying that ministries and branches needed to review and effectively combine national target programs to avoid overlap.

At the meeting, cabinet members said that because of drastic and timely efforts to control inflation, stabilize the macro-economy and ensure social welfare, the country’s socio-economic situation in August had been stabilized.

For instance, inflation had been kept at less than 1 percent, the lowest figure since the start of the year and export revenues had increased three-fold compared to the initial target.

In the first eight months of the year, the country posted an export turnover of US$60.8 billion, a year-on-year rise of 33.7 percent, plus an industrial production value increase of 7.3 percent, said the cabinet members, adding that the country attracted 3.96 million tourists in the reviewed period.

Implementing the Government’s Resolution 11, ministries, branches and localities also cut VND9.4 trillion from budget capital and government bonds, while groups and corporations suspended and slowed the pace of 907 projects totaling more than VND39.2 trillion.

The resolution has controlled the gold and foreign currency market and reduced monthly inflation rate to below 1 percent.

However, they said that epidemics and disasters have caused loss of life and property as well as hindrances to agricultural production, which pushed up input prices in agricultural production, in addition to high interest rates and difficulties in credit access.

Cabinet members proposed to continue strict implementation of the government’s resolution, focusing on restructuring public investment towards sustainable development, and gathering resources to promote agricultural production, breeding and aquaculture under large-scale production models, to ensure food security and increase farm products exports.

The cabinet reached consensus the need to prioritize macroeconomic stability, increase national economic competitiveness and maintain socio-political stability in order to lay a foundation for Vietnam to become a modernity-oriented industrialized nation by 2020.

To effectively implement the targets, Deputy Prime Minister Nguyen Xuan Phuc proposed the government soon stabilize the organization, especially the assignment of functions and tasks of each ministry for smooth, effective and transparent operations.

He asked ministries, branches and localities to speed up administrative reform, fight corruption, and minimize the mechanism of “giving” and “asking”, especially in budget allocation and major construction investment.

He also proposed the government pay more attention to agriculture, particularly the effective implementation of a national target program on new rural development.

At the meeting, cabinet members discussed the country’s land inventory results of the 2005-2010 period, land use plan until 2020 and the 2011-2015 land use plan and the 13th cabinet’s action program.

They also discussed several draft laws on judicial assessment and handling of administrative and advertisement violations, the prevention and control of tobacco impacts, and water resources.

Source tuoitrenews.vn

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