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Govt targets speculation, price rises
The prevention of price speculation and rises in the cost for essential goods would be among the Government's major tasks for the remainder of the year, Prime Minister Nguyen Tan Dung told the monthly cabinet meeting in Ha Noi on Wednesday.
The Prime Minister also asked ministries, economic sectors and localities to find ways to reduce interest rates and stabilise foreign exchange rates within an acceptable range while balancing the supply and demand for foreign currencies.
He did so after Planning and Investment Minister Vo Hong Phuc told the meeting: "The most challenging problems for Viet Nam's enterprises are the shortage of capital and high interest rates."
The overall picture of the country's socio-economic development in July and the other six months of the year had been positive, the minister said. All the objectives for stabilising the macro economy and controlling inflation had been achieved.
About VND77.6 trillion (US$4 billion) from the State budget had been allocated for development projects, or 62 per cent of the 2010 plan, as of July 31.
In all 533 projects had been licensed with total registered capital of more than $8.4 billion and more than $1.6 million of official development assistance (ODA) had been disbursed.
Export revenue to July 31 stood at $38.3 billion, an increase of 17.5 per cent against the first seven months of last year.
The trade deficit was reported at $7.4 billion – equal to 19.5 per cent of export revenue.
Inflation
The minister said the consumer price index (CPI) had risen 8.67 per cent to July 31 against the first seven months of last year.
"We can say that the inflation rate was under the control," he said.
The industrial production value had increased 13.5 per cent; the revenue from commodities sales and the service industry stood at almost VND878 billion ($46.2 million), an increase of 26.4 per cent compared with the same months of last year.
But the minister warned that although the economy had shown positive signs, Viet Nam still faced difficulties and challenges, including the trade deficit and the pressure the high cost for imported raw materials put on the CPI.
And he emphasised that a shortage of credit and high interest rates posed the greatest challenge to enterprises.
Request
The Prime Minister asked ministries and economic sectors to help promote industrial production and maintain the current production rate.
He also ordered relevant agencies to study and provide workable solutions to such social problems as on-line gaming and food and traffic safety.
The monthly meeting discussed proposed measures and policies to improve the quality of the economic growth, efficiency and competitiveness.
These are partly embodied in the Government's Resolution for the Reform and Development of Vocational Training by 2020 and the project to make Viet Nam strong in information technology and communications.
The draft Capital Law, Anti-Human Trafficking Law, Complaints and Denunciation Law, among others, were also discussed.
Revamp for Vinashin
Viet Nam, as a coastal country, was determined to develop its shipbuilding industry after its top shipbuilder, Vinashin, was recently found to be nearly bankrupt, said Permanent Deputy Prime Minister Nguyen Sinh Hung.
Hung was speaking at a press conference yesterday following the cabinet meeting.
He said the situation of the Viet Nam Shipbuilding Industry Group (Vinashin) remained under control and the giant could be rebuilt despite a VND86 trillion ($4.5 billion) debt.
Hung said the move was not irrational, highlighting the cutting of its over-expanded non-core businesses as the top cost cutting measure.
He said the new Vinashin would focus only on its core shipbuilding business and auxiliary industries.
Its non-core projects, including tourism, cement and sea transport, would be sold, transferred or equitised.
Hung said the State would provide the shipbuilder with extra capital if necessary to revive its business, but not to pay its debt.
He said Vinashin was expected to again start making profits by 2013.
The Deputy Prime Minister said the Government would re-evaluate businesses similar to Vinashin. It would also punish companies that violated laws and regulations, pushing the giant to the brink of bankruptcy.
A Government report issued yesterday said a pilot scheme introduced in June to reform Vinashin had produced some good results.
The Vinashin projects taken over by the Viet Nam National Oil and Gas Group (PVN) have started again.
More than 1,000 of the 6,000 workers who quit their jobs at Dung Quat Shipbuilding Factory in central Quang Ngai Province are reported to have returned to work. And, the report said, a 104,000-tonne oil tanker was expected to be launched this October.
Many of the vessels in the group of liners transferred to the Viet Nam Maritime Corporation have also restarted operation.
The report added that Vinashin had sold four new ships for $110 million, some non-core business projects and was doing its best to finish other shipbuilding projects.
Vinashin operated well in 2006-07, but ran into trouble in 2008, partly because of the global financial crisis. More than 5,000 Vinashin workers, or one fourteenth of its workforce, lost their jobs.
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