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Inflation battle on right track, says PM Dung
Early signs suggest that the Government's determination to curb inflation and stabilise the economy are starting to bear fruit, Prime Minister Nguyen Tan Dung told a cabinet meeting Mar. 15.
To bring consumer prices under control, the Government issued Resolution No.11 last month, calling for cuts in State spending, with an emphasis on eliminating unnecessary projects and conserving energy.
Positive developments have already slowed inflation, Dung said, easing the impact of rising prices on the life of the people, particularly the disadvantaged, elderly and disabled.
Dung attributed the success so far in implementing the resolution to the high commitment of ministries, sectors and localities nationwide. He particularly expressed his appreciation for the role played by the media in generating strong social consensus.
"What's more important is that we keep the good momentum going," said Dung.
He conceded that implementation of the resolution had seen some problems, particularly in the management of gold and foreign exchange markets.
"We have had to adjust our policies to meet the needs of people and enterprises," Dung said. "We still need to develop a road map to elliminate the illegal trading of gold bars on the open market."
"Dissemination of Government policies on forex and the gold market should not stop only at stabilising these markets, but should also inspire public confidence," said Permanent Deputy Prime Minister Nguyen Sinh Hung, who agreed that Resolution No.11 had already had a positive impact on the nation's economy.
The cabinet meeting also heard a report on economic performance in the first quarter of 2010.
Growth during the quarter was estimated to have reached 5.4-5.6 per cent, while exports rose by nearly 30 per cent over the previous year to a total of US$ 18.8 billion – triple the target set by the National Assembly for the quarter. Imports, however, also continued to rise, increasing by nearly 24 per cent during the quarter to $21.8 billion, a figure that continued to feed a widening trade deficit.
Interest rates on loans in Vietnamese dong also remained high, at an average of over 16.2 per cent per year, while those on loans in US dollars averaged 6.37 per cent.
Interest paid by commercial banks on deposits in dong also continued to be elevated, exceeding an average of 13 per cent per year, while interest paid by commercial banks on dollar deposits averaged 6.37 per cent per year.
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