Hanoi Promotes Production and Business

The second plenary meeting of the 15^th Hanoi People’s Council in July heard social and economic results in the first half of 2011. The capital city maintained good growth momentum, with gross domestic product (GDP) climbing 9.3 percent year on year over in the first six months and State Budget revenues completing 52.9 percent of the plan.

 

Total development investment capital rose 12.6 percent to VND77 trillion in the first six months of 2011 but if inflationary factors were counted, the growth was actually just 0.6 percent. Investment for basic construction topped VND5.4 trillion, equal to 94.7 percent in the same period of 2010 but the capital disbursement for basic construction equalled 26.1 percent of the plan in the first five months and 30.9 percent in the first six months. Giving reasons to slow disbursement, the city’s leaders attributed to the reduction and rescheduling of public investment projects in accordance with the Government Resolution 11/NQ-CP. Many projects were delayed or rescheduled. The State Treasury has not disbursed for projects starting after February 24, 2011.

 

Positively, FDI continued to revive in Hanoi although it declined in Vietnam. The city licensed 162 fresh and operational projects to invest US$891.8 million in the reporting period, an increase of 6.8 times over the same period in 2010.

 

Hanoi granted business registration certificates to 8,630 enterprises with a total investment capital of VND47.9 trillion, up 1 percent in project and down 31 percent in value year on year. The city created favourable conditions for all economic sectors to do business and establish new business entities with simple procedures (completed in 7-15 days), aiming to increase incomes for the State Budget and developing Hanoi into a modern, leading city in Asia.

 

Hanoi Mayor Nguyen The Thao said that challenges to the capital economy are significant. The targeted GDP growth is 12 percent in 2011 and the city will have to achieve the growth of least 14.3 percent in the last half to reach the target. This is a very difficult task because the city has to fulfil two objectives at the same time: Maintaining high growth and curbing inflation. Therefore, stimulating the business community to expand production and business activities is the key for the Hanoi economy to develop quickly and sustainably.