Vietnam Economy Could Grow over 6.5% This Year: Minister Phuc

Vietnam could achieve a GDP growth rate of more than 6.5% this year, higher than the approved target, Minister of Planning and Investment Vo Hong Phuc told the Vietnam News on February 23.

 

The economic slowdown in Vietnam bottomed out in the first quarter of 2009 and will not return if policies to stabilize the macro economy are effective, Minister Phuc emphasized.

 

The domestic economy has shown clear signs of recovery since January of 2010, Phuc said, noting industrial production in January jumped 28% from the same period last year whilst retail sales were up 23% and exports were up 28%.

 

Last year Vietnam licensed 76,000 companies, generated 1.5 million new jobs and curbed inflation below 7%, Phuc said, forecasting the country will still face challenges this year including a high trade deficit, limited liquidity, high prices of essential goods and natural disasters.

 

Receiving large investment from the state budget, the state economic sector has not performed effectively and the government needs to reconsider its policy to create a healthy competition among the economic sectors, he added.

 

First Deputy Prime Minister Nguyen Sinh Hung has urged the Ministry of Industry and Trade to boost sales of Vietnamese goods, noting the domestic demand accounts for 15%-18% of the country’s GDP.

 

Hung also asked the State Bank of Vietnam, the country’s central bank, to keep an eye on the monetary market and adopt suitable policies to stabilize the macro situation, control inflation, boost exports and ensure liquidity in the banking system.

 

The Asian Development Bank (ADB) forecast in a recent report that Vietnam’s economy will grow at 6.5% this year, up from 5% last year, led by stronger investment and stimulus policies.

 

Vietnam’s GDP will also lead the Asean economies which will post positive economic growth this year, the report said.

 

Pham Chi Lan, an economist, said that the economy will not develop sustainably if we just develop industries which are based on low-cost labor forces and export of raw material resources. (VNS)