Co-ordination needed to stabilize macroeconomy
Print 
Stabilising the macroeconomy should be associated with ensuring social welfare in order to bring the nation’s combined strengths into full play.
The recent international incidents such as the political instability in the Midde East and North Africa, the earthquake and tsunami in Japan, and the runaway inflation in China are negatively affecting Vietnam’s socio-economic developments.
The Government has issued six groups of measures to deal with the situation but how to implement them effectively remains in question.
Disadvantages from the outside world
There is no denying that the recent international developments have made it all the more difficult for the Vietnamese Government to control inflation, stabilise the macroeconomy, and ensure social welfare.
The soaring inflation in China, the world’s second biggest economy, is a case in point. While the Chinese Government is bent on curbing inflation, the prices of goods imported from this country continue to go up. With an annual import turnover from China estimated at billions of US dollars, it will be no easy task for the Vietnamese Government to control the trade deficit.
The massive earthquake and tsunami in Japan on March 11 also have negative effects on Vietnam’s economy. This country is Vietnam’s largest importer with an annual revenue of about US$20 billion and biggest official development assistance (ODA) provider.
Meanwhile, the increasing political instability in the Middle East is pushing up oil prices in the world and also petrol prices in Vietnam.
Pros and cons from within
Effort to strictly implement the Government’s Resolution 11 on stabilizing the foreign currency market and interest rates and preventing illegal gold and foreign currency transactions have paid off. Export turnover in the first quarter of the year is estimated at US$18.8 billion, up 30 percent compared to last year’s same period and three times higher than the set target. State budgets collections had reached VND126.000 billion by March 15, much higher than a year ago.
Such initial results testify to the sound leadership of the Government, and the co-ordinated efforts of the entire political system and society. However, there remain big challenges such the risk of a high inflation rate (6 percent) in the first three months, people’s concerns over the State management of foreign currencies, the Government’s ban on bar gold trading, high interest rates, and lack of transparency in many fields of activity.
Co-ordinated efforts needed
At a recent cabinet meeting, Prime Minister Nguyen Tan Dung urged relevant ministries and agencies to actively respond to the Government’s Resolution 11 by building up action plans and conducting comprehensive measures to stabilize the economy.
He asked the State Bank of Vietnam and related ministries and agencies to keep a close watch on foreign currency trading and prevent illegal transactions to control the rate of exchange and meet people’s and businesses’ legitimate demands for foreign currencies.
PM Dung requested the Ministry of Industry and Trade (MoIT) to promote exports and reduce import surplus to no more than 16 percent by tightening controls on importing unnecessary goods such as automobiles, alcohol, and foodstuffs. He also asked the MoIT to build up a plan for saving energy by cutting down the supply of electricity to certain factories, advertising and public lighting activities.
PM Dung insisted that the Ministry of Planning and Investment make public the list of projects which will be cancelled or suspended by April and the Ministry of Finance to work out plans to save up to 10 percent of public spending in the last 9 months of 2011.
He agreed with the Ministry of Public Security’s proposal to set up interagencies working teams to control prices and stabilize the market.
The Government’s resolution 11 has mentioned comprehensive measures to stabilize the macroeconomy. However, it cannot be brought to life without social consensus.
