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Annual growth could exceed 6.5%
Viet Nam would achieve a GDP growth rate of more than 6.5 percent this year, which is higher than the set target, says Vo Hong Phuc, Minister of Planning and Investment.
The economic slowdown in Viet Nam has bottomed out in the first quarter of last year, and would not return if policies to stabilise the macro-economy are implemented effectively, Phuc said.
Since January, the country's economy has shown clear signs of recovery, Phuc said, adding that the country's industrial production value in January was 28 percent higher than the same period last year, while corresponding total retail sales increased by 23 percent and exports went up by 28 percent.
In addition, the Asian Development Bank (ADB) 's recent report has also forecast economic growth for Viet Nam this year at 6.5 percent, up from 5 percent in 2009, driven by stronger investment and stimulus policies.
According to the report, all ten countries in the ASEAN grouping will enjoy positive GDP growth in 2010, with Viet Nam continuing to record the highest growth rate in the region.
The quick adoption of economic restructuring during the crisis by local enterprises has helped them overcome the crisis and they would develop strongly this year, Phuc said.
Despite the economic difficulties, about 76,000 new enterprises were established last year, generating 1.5 million jobs, he added.
Viet Nam had also successfully kept the inflation rate to below 7 percent last year, and ensured implementation of social welfare policies, he said.
However, Phuc said the country would still face many challenges this year, including that of a high trade deficit, limited liquidity, high price of essential goods and natural disasters.
Pham Chi Lan, an economist, said the crisis has helped local enterprises figure out their shortcomings and find measures to cope with the new situation.
"The country's economy will not develop sustainably if we just develop industries that based on low cost of labour and export raw natural resources," Lan said.
Despite receiving large investments from the State budget, the State economic sector has not performed effectively, and the Government needs to reconsider its policy so as to create healthy competition between economic sectors, he added.
Permanent Deputy Prime Minister Nguyen Sinh Hung has urged the Ministry of Industry and Trade to strengthen the promotion of Vietnamese goods, noting domestic demand accounts for between 15-18 per cent of the GDP.
He also asked the State Bank of Viet Nam to keep an eye on the monetary market so that it can adopt suitable policies to stabilise the country's macro-economy, control inflation, boost export and ensure liquidity in the banking system .
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