This Year's Economic Growth Lower than in 2005

In 2006, the Vietnamese economic growth may reach 8.1-8.2 per cent, said Minister of Planning and Investment Vo Hong Phuc said at a symposium on December 1, 2006.

 

In 2006, the social investment sum is estimated at VND390,500 billion (US$24.4 billion), or equal to 40 per cent of GDP. The export earnings verged on US$40 billion, with a growth rate of some 22 per cent and the foreign direct investment capital attraction hallmarked nearly US$9 billion.

 

Minister Vo Hong Phuc said the GDP growth rate exceeded the initial target of 8 per cent and higher than the average growth rate of 7.5-8 per cent set for the 2006 - 2010 phase. However, this year’s economic growth rate is still lower than last year’s 8.43 per cent.

 

2006 also witnessed positive signals in the international economic integration of the entire country. Notably, Vietnam concluded lengthy negotiations for its accession to the WTO. Vietnam continues to fulfil commitments to ASEAN countries, to the Vietnam-US bilateral trade agreement (BTA) and other bilateral and multilateral commitments to bring our economy to penetrate more deeply into the world.

 

The successful hosting of the APEC Vietnam 2006 has had a strong influence on boosting national economic development, improving the image of Vietnam, widening investment capital channels and generating more business opportunities.

 

Under the plan set for the year 2007, the Vietnamese economy will grow by 8.3-8.5 per cent, GPD will reach some US$70 billion and the per capita GDP will increase to US$820 a year.

 

Minister Vo Hong Phuc said the Government desires to see the economic growth rate of 8.5 per cent, higher than the average rate set by the National Assembly. Local governments also agreed to take 8.5 per cent growth as a norm to set objectives and seek measures. Mr. Phuc believes there are many foundations for the realisation of this target. First of all, the export revenues in 2006 grew 22 per cent higher than the amount last year. Such a growth rate is highly likely in Vietnam. Vietnam has joined the WTO, a global commerce club. Many enterprises have chances to expand export markets and raise the revenues. In addition, Vietnam will try to keep the social investment capital equal to 40 per cent of GDP in 2007 - a similar rate in 2006. We have created huge investment sources and broadened export markets - important factors to maintain the growth rate at a high level.

 

Addressing at the meeting, Prime Minister Nguyen Tan Dung said it is important to raise both domestic and foreign capital sources to a maximum to obtain a high economic growth rate as set in the plan. Therefore, one of the key important missions of 2007 is to continue streamlining public administrative procedures related to investment. 2007 must create a big change in this field.

 

The Prime Minister said in the past, public administrative reform has made a long leap forward but still fails to realise the target of mobilising all resources to a maximum for development investment. At present, we have the Law on Investment and the Law on Enterprise; hence, we need to re-examine all formalities. State management authorities must start from enterprises to detect difficulties for resettlement.

 

Currently, we have big advantages to draw foreign investment and many foreign investors have arrived in Vietnam. But, they are still complaining about our administrative procedures. When a project is begun, its investors must visit many different State bodies. Recently, several reliable international organisations degraded the competitiveness capacity of Vietnam. We should look directly into the matter and seek settlement solutions.

 

The second task the Prime Minister requires in 2007 is to recheck all planning projects to get rid of suspended ones. Planning projects have significantly contributed to the economic development but also generated troubles if the projects are infeasible and impractical. 

 

The Prime Minister ordered big progress in eradicating suspended projects in 2007. Hence, the Ministry of Planning and Investment must to recheck planning projects in the country. All basic information about the project such as construction schedule must be publicised and the planning project must count the public interests first.

 

The Prime Minister also asked to relevant bodies to improve the weaknesses in infrastructure system. The State Budget remains the main capital source for the construction and development of infrastructure system. We must calculate and unify all infrastructure projects which will affect the national economy. It is important to put forth resources for the development of the infrastructure system in the next five years.