Kien Giang Province: Firm Steps on Integration Road

To implement socioeconomic development tasks set for 2009 amid the economic slowdown in Vietnam, the financial crisis and economic recession in the world, and its adversely negative impacts on social and economic aspects, Kien Giang province has spared no effort to weather difficulties and focus on executing measures of the Government and the economic growth is thus still good. The local gross domestic product (GDP) valued VND7,983.7 billion in the first six months of 2009, is up 9.2 per cent year on year.

 

Particularly, the agriculture, forestry and fishery contributed 2.49 per cent; industry and construction, 3.17 per cent; and trade and service, 3.54 per cent. The province was estimated to earn US$260 million from exports from January to June of 2009, including US$211.6 million from agricultural products, US$39.5 million from seafood and US$8.9 million from other commodities, which was equal to 52 per cent of the full-year plan and up 33.4 per cent from the same period of 2008. Favourable rice shipment is expected to reach 800,000 tonnes this year, an increase of 100,000 tonnes from the initial plan. Economic slump, market shrinkage and material instability sank export revenue to only 23.24 per cent of the yearly plan. Worst, shrimp export revenue was equal to 15.33 per cent of the yearly plan. The number of visitor arrivals to Kien Giang province approximated 1.9 million in the six-month period, which equalled 50.2 per cent of the yearly plan and increased 15.8 per cent from the corresponding period of 2008.

 

Although the economic growth slowed down, there has already been the signal of recovery. GDP growth was only 7.6 per cent in the first quarter and 10.06 per cent in the second quarter.

 

To prevent economic slump and obtain the GDP growth of 12 per cent this year as ratified by the Party Committee and People’s Committee of Kien Giang province at the start of the year, the province has adopted measures and policies to achieve the expected objectives, focusing on resolving difficulties and boosting production, and carrying out social security policies.

 

The stimulus package of the government, which focuses on interest rate subsidy for enterprises, has helped the province to develop and helped local enterprises and labourers cushion difficulties. The provincial authorities manage to control market price movements, stabilise the market, inspect food safety and hygiene and boost business and production activities. The province has kept tabs on preventing smuggling, trade fraud, cornering and trading of counterfeit goods, low-quality commodities.

 

With regard to fiscal, financial and monetary policies, we have delayed taxes and reduced taxes in accordance with the Government’s policy. Accordingly, we have delayed personal income tax payment for 13,259 people with a combined tax mount of VND12 billion, equal to 93 per cent of the initial estimation, reduced 30 per cent of corporate income tax for 533 enterprises, with a total tax amount of more than VND6.9 billion in the fourth quarter of 2008, and for 629 enterprises in the first quarter of 2009 with a reduction of VND8.2 billion. It has also delayed corporate income tax payment worth over VND20.2 billion for 590 enterprises in the first nine months of 2009 as provided in the Resolution 30 of the Government. It has reduced 50 per cent of value-added tax (VAT) for 579 enterprises at VND10.2 billion as stipulated in the Decision 16 of the government. Commercial banks also disbursed interest rate-subsidised loans for local enterprises.

 

The province has also adopted the lending policy in accordance with the Decision 443/QD-TTg of the Prime Minister but the borrowing amount remained limited. The lending for purchasing materials and equipment for agricultural development and rural housing construction in proportion to the Decision 497/QD-TTg of the Prime Minister is being carried out. The credit guarantee based on the Decision 14/2009/QD-TTg of the Prime Minister has so far benefited 38 enterprises. To date, eight enterprises were guaranteed to borrow VND27.3 billion and lenders issued the attestation for VND23.5 billion. The credit funds for small and medium-sized enterprises have guaranteed 22 units to borrow VND96.2 billion.

 

At the same time, the province has timely carried out the preferential credit policy of the Government on supporting poor households to build shelters and laid-off workers to live through the difficult time. The total interest rate subsidised lending amount has reached VND33 billion, of which 65.7 per cent has been disbursed to poor households to do business and 21.5 per cent has been lent to households in poor regions.

However, the province has failed to meet several objectives. Infrastructure construction sourced from State Budget and non-State Budget capital was still behind time. Commercial banks have lent an unsatisfactorily limited amount of interest rate subsided capital to enterprises. Lenders required borrowers to settle outstanding debts to get the interest rate-subsidised loans. Local enterprises were also passive in renovating technologies and restructuring production in the current context of market difficulties.

To implement its socio-economic development plans, we will focus on instructing subordinated units to implement solutions to shore up production and business development, especially solutions on administrative reforms, land approach, credit policy and tax policy. Besides, we will promote trade and market activities, prevent trade fraud and smuggling, keep a close watch on market prices and ensure food safety and hygiene.

 

In parallel, the province also is trying to improve infrastructure to be an attractive investment destination. Especially, the province will offer soft loans from the government’s stimulus package to boost the local socioeconomic development.

 

Kien Giang will concentrate on developing social and cultural aspects, protect the environment as well as exercise social security policies. The province will not only continue with acceleration in administrative reforms but also double its effort to fight against corruption, exercise thrift practices and prevent wastefulness. The locality will also strengthen national security and defence and maintain social order and security to create a favourable environment for socioeconomic development.

 

The province will also reinforce the public consensus to ride out difficulties and challenges to achieve development targets.

 

Kien Giang will also expect more ODA to develop rural electric system to serve agricultural development. At present, the State Budget is able to allocate only VND20 billion (US$1.2 million) on electric network development and this is apparently an extremely small amount to the needs. To meet the capital demand for key projects to expand production and achieve economic growth target in 2009, we hope the Government of Vietnam will assist us with building traffic, irrigation, health and education projects and Tac Cau fishing industrial complex.