Gov’t urges macro economic stabilization

The Government in the last regular cabinet meeting of 2011 on Wednesday urged its members to join forces for realizing the socioeconomic development plan for 2012, targetinh on gurbing inflation and stabilizing macro economy taking the center stage.

The nation gained initial results from implementing the austerity package contained in Resolution No. 11 last year, with the consumer price index (CPI) growth rate slowing down from the second quarter. Lending rates also fell while export surged by 33.3% compared to 2010.
Vietnam achieved a GDP (gross domestic product) growth rate of 5.89% in 2011, of which primary industry grew 4%, industry and construction rose 5.53% while service jumped 6.99%.
However, the nation saw increasing signs of macro uncertainties due to drastic directions from the resolution, said the Ministry of Planning and Investment.
Fast credit growth rate, shortcomings of the real estate market and of the banking system due to poor liquidity, and bad debts had led to higher-than-allowed capital mobilization. The gold market also suffered wild volatile developments during the year.
Despite the Government’s tightening fiscal policies, total investment still surged strongly last year. Up to over 680 projects using VND1.7 trillion of the State budget, which were not allowed to kick-start in 2011, were still implemented.
Macro uncertainties also hurt the business community as tens of thousands of small and medium-sized enterprises went bankrupt. Many sectors like construction, cement and steel face many challenges.
Prime Minister Dung also named a number of shortcomings that need to be tackled in 2012, including the low quality of legal documents, poor planning and management of natural resources, pressing environmental pollution and traffic congestion and accidents.
According to the cabinet’s latest Resolution No. 01/NQ-CP, in 2012, the Government set to attain the GDP growth rate of 6-6.5% and total export turnover growth of 13%, keep the trade deficit at 11-12% of the country’s total export value and the consumer price index under 10%.
Under the direction, the credit growth will be pulled down to around 15-17%, total money supply growth at 14 -16%, while budget deficit will be kept under 4.8% of the GDP.
At the meeting, the Ministry of Planning and Investment submitted to the Government a draft project on improving the efficiency of State-owned enterprises (SOEs).
Regarding the project, Prime Minister Dung stated that restructuring SOEs solely aims to better their performance so that they will be able to play the leading role in boosting socioeconomic development, stabilizing the macro economy, securing macro indexes and others.
The ministry will be responsible for collecting comments from ministries and sectors and finalize the project soon.

Source Saigontimes Daily

Posted by VBN on Jan 6 2012. Filed under Economy News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry