The socio-economic situation over the past 11 months has included a number of positive indicators but also revealed difficulties that need to be addressed in the near future.
Macroeconomic management has proven effective in stabilising the socio-economic trends, achieving major economic targets and ensuring social welfare and security in a difficult context for budget collection. This will provide the Vietnamese Government with the momentum to improve the socio-economic situation next year—a pivotal year in the 2011–2015 socio-economic development plan.
Despite both domestic and global economic woes, 2012’s socio-economic situation has made remarkable progress in controlling inflation and the monetary market with stable exchange rates, credit interest rate reductions of 5–7 percent, foreign currency reserve increases, and overseas remittance transfers worth tens of billions of US$. Nearly 1.4 million new jobs were created and industrial production grew by 6.7 percent compared to the same period last year. Traffic accidents, fatalities, and casualties declined.
There is no denying that country’s achievements exceed those of 2011. The consumer price index (CPI) was at 18 percent this time last year but only 6.52 percent at the end of November. The figure defies the predictions of domestic and foreign economic organizations, indicating the Government’s effective economic management.
Last year’s export surplus numbered approximately US$9 billion but export-import ratios were balanced by late November.
The exchange rates between US dollars and Vietnam Dong have been kept within the permissible fluctuation band since the middle of 2011, helping to stabilise the monetary market. Lending interest rates have remained at 15 percent/year over the past few months compared to 20 percent last year.
The disbursement of investment capital resources including ODA funding was accelerated while social welfare policies were properly implemented, allocating thousands of billions of VND to social policy beneficiaries and those living in areas struck by natural disasters.
Despite the initial successes of macroeconomic management in 2012, the new year will also usher in a number of daunting challenges. These potentially include unsteady macroeconomic stability, a high risk of runaway inflation, rising bad debts, delayed restructuring of the banking system, sluggish industrial production recovery, and difficulties in agricultural production caused by epidemics and natural disasters.
Dealing with outstanding debts from capital construction investment is imperative, as is balancing budgetary revenues and outlays to keep overspending under 4.8 percent.
The Government has devised nine solutions to 2013’s emerging issues, focusing on resolving bad debts and large inventories, restoring production, saving the property market, and streamlining the disbursement of ODA funding and FDI capital.
The Government will also prioritise stronger measures for stimulating agricultural production and exports, advancing administrative reform, and combating smuggling and trade fraud (including preventing illegally imported consumer goods of unclear origins and not subject to the usual quarantine inspections for food hygiene and safety).
The Government wants to control price hikes and inflation, guard social welfare by caring for the poor and social beneficiaries, practicing thrift, and eliminating waste.
If the issues related to businesses’ capital access, excess inventories, bad debts, and the banking system restructure are tackled successfully, social confidence will be consolidated and 2013’s socio-economic situation improved.
Vietnam’s socio-economic targets for 2013 include maintaining the economic growth rate at 5.5 percent and the CPI at 8 percent, holding overspending at less than 4.8 percent, and creating 1.6 million new jobs.
CPV/VOVNews
Vietnamese
