In a government report on the implementation of the socio-economic development plan and the State budget for the first half, and main solutions for the second half, of the year, Deputy PM Hung said that the country has recorded a high economic growth rate, managed a balanced economy, ensured a stable society, defence and security, expanded external relations and improved the people’s living conditions.

These are basic premises for us to overcome difficulties and fulfill socio-economic development targets for the second half and the whole year, he added.

Deputy PM Hung spoke of seven main accomplishments of the implementation of the country’s socio-economic plan in the past six months.

First, the country maintained a high economic growth rate, creating a premise for reaching or surpassing the growth rate set by the NA for the whole year. The nation recorded a GDP growth of 7.87 percent over the past six months, the highest record for the first half over the past five years. It attained a 16.9 percent increase in industrial production value, an almost 10 percent rise in added value, a 2.67 percent rise in agro-forestry and fisheries, and an 8.41 percent increase in services.

Secondly, Vietnam also gained a positive growth rate in export value thanks to successful outlet expansion. Export revenue in the first half of 2007 is estimated at more than 22.45 billion USD, a 19.4 percent rise year on year, with six staples fetching more than 1 billion USD. Markets have been expanded with the US, the European Union (EU) and Japan accounting for over 60 percent of the nation’s total six-month export turnover, year-on-year rises of 23 – 28 percent.

Thirdly, financial and budget activities continued to develop sustainably. The State budget income is estimated at more than 129.9 trillion VND (8.1 billion USD), a year-on-year hike of 13.7 percent over 2006 and equivalent to 26.3 percent of its GDP while expenditure from the State budget is estimated at over 163.7 trillion VND (10.2 billion USD), a year-on-year rise of 17.6 percent. The stock market saw a strong development over the past six months thanks to the Government’s management measures aiming to reduce risks for investors.

Fourthly, the country’s consumer price index (CPI) surged by 5.2 percent in the past six months, compared to 4 percent in the first half of 2006 but remained under control. The housing and construction materials recorded the highest increase of 8.24 percent, followed by the food and foodstuff group, up 6.8 percent. Other commodities rose by between 2.72 and 4.3 percent.

The CPI was affected by the world’s rising prices of petrol, steel, plastics, food and foodstuff. The government step-by-step wiped out price subsidies for petrol, electricity, coal, cement and steel while expanding total means of payment to increase the national foreign reserves.

Fifthly, the country’s social investment capital is estimated at 195 trillion VND (12.1 billion USD), representing a 43.2 percent of the yearly plan and accounting for 39.5 percent of GDP. Of the figure, 42.3 trillion VND (2.6 billion USD) came from the State budget; 27.7 trillion VND (1.7 billion USD) from State-owned enterprises, almost 34 trillion VND (2.1 billion USD) from foreign direct investment capital and 68 trillion VND (4.2 billion USD) from the private sector.

Sixthly, cultural and educational, healthcare, scientific and technological activities have been expanded nationwide. Job generation, poverty reduction and hunger elimination and epidemics prevention were intensified.

The administrative reform is making major progress with a number of solutions underway, focusing on procedures such as streamlining paperworks, clearly defining responsibility for each position, and solving in the fastest possible way ordinary people or entrepreneurs’ issues.

The combat on corruption and campaigns for thrift practice and against wastefulness have received positive response from authorities at all levels and industries as well as strong support from people of all walks of life and the entire society.

As a result, the work is undergoing great changes for the better.

The Deputy Prime Minister also pointed out seven major outstanding problems.

First, although the economic growth rate in the first half was high, it was still lower than the whole year target of 8.5 percent.

In order to achieve its yearly GDP target, the growth rate in the second should surpass 9 percent, which demands a high determination and concerted efforts from the administrations at all levels and all industries as well as business circles.

Secondly, some major industrial cash earners suffered lagging-behind growth rates against the industrial average. Crude oil production output, for example, was reduced by one tonne as compared to the corresponding period last year.

Meanwhile, electricity with its growth rate estimated at 11.6 percent, natural gas at 7.7 percent, and cement at 11.6 percent appeared falling behind demands for daily life and production.

Thirdly, the slow agricultural growth in both production output and added values has impacted on the national economy. Droughts, insects and birdflu had been developing complicatedly and are posing threats to production, community health and daily life if no immediate measures are taken, despite the current control of these problems.

Fourthly, the slow implementation and disbursement of investment commitments, the State budget, Government bonds and State credits as compared to the progress made in the corresponding period last year required greater efforts by public agencies, enterprises and project executives so as to meet targets set forth by the National Assembly.

Fifthly, year-on-year import growth estimated at 30.4 percent has triggered a surge in trade deficits, accounting for 21.3 percent of the gross export revenues.

Sixthly, though still under control, price increases hit a high level while an instability threat is looming over the market.

To control the price hike in an effort to stabilise the macro-economy and the people’s daily life would be a key task for the remaining period of the year.

Seventhly, rampant traffic accidents, food poisoning, and problems in management and use of vaccines have aroused public concerns; complicated developments of public petitions, especially the assembly of a large number of petitioners in Ha Noi and Ho Chi Minh City have asked for concerted efforts that lead to immediate solutions.

The Government report has also pointed out major measures necessary to be taken in the rest of the year to fufil three key yearly targets. These targets include high and sustainable economic growth along with solutions to social problems and poverty reduction. The other two are to speed up administrative reform so as to make major progress in administrative procedures and to push ahead the fight against corruption and campaigns for thrift practice and waste combat.

The Deputy PM presented several leadership options, including major guarantees for major economic balances so as to record high and sustainable economic growth.

This target asks for measures to ensure price increases staying below the economic growth rate in line with market objective signals, stimulis to export promotion and import control as well as solid balance in finance and monetary.

He also called for efforts to tackle difficulties, create good production and business climate and speed up the execution of investment projects, especially those that can leverage economic development.

This task demands for higher growth in industries and services of great potential, further reforms for a transparent and liberal investment climate to further draw foreign investment, and faster disbursement of budgets for infrastructure projects.

Other recommendations include concerted efforts to speed up the poverty alleviation programme in an active and firm way, to take initiative in containing plant and animal diseases and mitigating consequences of natural disasters and to intensify examinations on food quality and sanitation.

He also pointed out the need to concentrate on traffic safety in an effort to reduce traffic accidents and to continue with administrative reforms along with efforts to the anti-corruption fight, campaigns for thrift practice and waste combat.

Source: VNA