The Standing Committee of the lawmaking National Assembly said up to 12 out of 15 indicators will reach and exceed their targets while the rest will likely fail to hit their goals, including GDP growth, social development investment capital ratio, and employment. According to economic experts, all these three indicators are so important that they will probably affect economic growth in the next stage.
The National Assembly’s Standing Committee said that the economy faced a lot of difficulties and obstacles in the first nine months. In the last three months of the year, the economy will fulfil basic goals set for 2013: Macroeconomic stability, lower inflation, higher growth than 2012, and guaranteed social security and welfare
Mr Nguyen Van Giau, Chairman of the Economic Commission of National Assembly (ECNA), said low inflation, reduced imports and insignificant trade deficit are not signs of sustained economic recovery. In three years from 2011 to 2013, average annual economic growth is expected at 5.6 percent, the lowest annualised growth in 13 years. This growth is also lower than the initial target of 6.5 - 7 percent. Strikingly, while Vietnam's economy is showing signs of slowdown, many ASEAN economies have improved markedly.
In the past years, agricultural production is always an economic strength and a supporting pillar of the economy in the hard times but the agricultural growth is slowing, from 3.3 percent in the 2006 - 2010 period to about 2.81 percent in 2013. The decline in both output and price has caused negative impacts on the people and the economy. Food prices fell 5 percent in 2012 and 3 percent in 2013.
Economic restructuring integrated with growth remodelling has achieved important results although there are many different opinions about the results. According to the Standing Committee of the National Assembly, after the conclusion of the third meeting of the 11th Central Party Steering Committee, economic restructuring has produced some important results, helping the economy to transform into a better pattern. However, the results are still limited and far from the spirit of the Resolution of the National Assembly: Have good preparations in 2012 for drastic changes from 2013 to 2015.
Economic difficulties in 2011 - 2013 placed a strong influence on State budgetary balance and development investment capital. Therefore, the Economic Commission of the National Assembly anticipated that economic growth will not be a breakthrough in 2014 and the mobilisation and effective use of resources for development remains limited. Inflationary pressure will be stronger in 2014 if public investment is raised, credit growth is loosened, and prices of electricity, coal, public services and wages are increased. Job generation in the midst of no unemployment growth is a burning issue.
Mr Giau said some experts attributed the causes of economic stagnation to policy management in the past three years which extensively focused on macroeconomic stability, inflation control and excessive tightening of growth resources. Slowing growth, corporate bankruptcy, corporate operating halt, shrinking State budget revenue are inevitable outcomes as aggregate demand contracts suddenly.
Mr Phung Quoc Hien, Chairman of the National Assembly’s Finance and Budget Committee, said that the recent credit squeeze is too sudden and it has left huge effects on economy. Sudden credit tightening in the context that 70 percent of companies depend on loans has caused many to slide into dilemma. They are then unable to absorb capital when the credit is loosened.
After assessing conditions and constraints the economy may face in 2014, the Economic Commission of the National Assembly has proposed a targeted economic growth of 5.5 percent in 2014. This rate is reasonable as it does not trigger inflationary pressures. Consumer price index is expected to be capped at 6 percent, total social investment capital account to account for 30 - 31 percent of GDP, credit growth to reach 14 - 15 percent, and State budget-funded investment to rise at least 10 percent.
Dinh Thanh
Vietnamese
