The Ministry of Planning and Investment has said that two key socio-economic indicators - GDP growth and CPI - in the first six months of 2010 are positive.
The gross domestic product (GDP) is estimated to expand 6-6.1 % in the first six months, with 5.83 % growth in the first quarter and 6.2-6.4 % in the second quarter. The consumer price index (CPI) climbed only 0.22 % in June from the previous month.
Supporters for good growth
The Ministry of Planning and Investment said the country's economy continued to recover rapidly in the first six months. All sectors achieved higher growth rates than the same period last year. Particularly, agriculture, forestry and fisheries expanded 2.7-3.2 %, industry and construction leaped 6-6.7 %, and service sector climbed 6.8 to 7.2 %.
In the first half of the year, growth-supporting factors were good enough. Development investment helps industrial production growth to climb three times higher than the same period of last year. In addition, consumer demand and export performance continued to improve.
Specifically, State-funded investment is estimated to complete 36.5 % of the full-year plan in the first five months of 2010 in addition to larger disbursement of ODA loans than the same period of last year. Total outstanding loans of the economy as of May 31 rose 7.5 % from December 2009.
In addition, according to the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment, foreign investors registered to invest US$8.43 billion and disbursed US$5.4 billion from January to June 2010.
More investment spurred the industrial production growth. According to the Ministry of Industry and Trade, 29 out of 33 industrial goods grew up in the last past months in comparison to same period of 2009. Remarkably, petroleum output rose seven times, LPG production doubled, air-conditioner output picked up 46 %, machine tool production increased 45 %, etc.
Domestic retail revenues of goods and social services increased 27 % in the first five months of this year over the same period of 2009. If the price factor is excluded, the growth was in the region of 17 %.
Meanwhile, exports were still on the rise. The increase in outbound shipments signalled a solid recovery in exports and could compensate declines in gold and mineral exports last year.
The Ministry of Planning and Investment said exports will be accelerated in the coming months and the domestic market will create a driving force of the continued growth.
Inflationary restraints
According to the General Statistics Office (GSO), CPI rose only 0.22 % in June from May and 4.78 % from December 2009. The CPI in the first six months of 2010 climbed 8.75 % from the same period of 2009.
In the coming time, prices of CPI-weighted goods like rice, meat, gasoline and medicines will continue to be kept stable.
As regards rice, the Vietnam Food Association said the country exported nearly 200,000 tonnes of rice in June, totalling 2.9 million tonnes worth US$1.3 billion in the first six months.
The Mekong River Delta is harvesting the summer-autumn crop and unhusked rice prices tend to soften, standing at VND4,250-4,350 per kilo last week.
Northern provinces are harvesting the winter-spring paddy crop. The new supply is driving down rice prices in some localities.
The Domestic Market Regulating Group, administered by the Ministry of Industry and Trade, forecast rice prices will stay stable, given a sharp increase in supply.
In addition, in the food group, pork - a heavy weight in the CPI basket - is projected to be stable in the coming time.
Current pork prices declined by VND1,000-3,000 per kilo to VND27,000-30,000 in the north and VND29,000-33,000 in the south.
A slide in pork price was also attributed by the complex porcine reproductive and respiratory syndrome (PRRS) epidemic, which caused a drop in consumption. Consumers tend to use more other meat like beef and chicken. Pork price is projected to slump but other meat will stay at high rates.
Also according to the Domestic Market Regulating Group, prices of petroleum products will continue to be stable. Gas prices tend to fall as global rates is expected to tumble further. Steel prices are expected to drop more.
According to the Ministry of Health, medicine prices were generally stable in the past months.
Unfavourable weather, specially hotness, and human diseases are forecast to make more people hospitalised and drug demand will therefore leap. But, good supply will ensure stable prices of medicines.
With supporting elements, CPI is forecast to be kept stable in the coming months. (VGP)
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