While exports and foreign investment flow have been continuing with their positive and stable growth rates, the consumer prices have been spiralling.

The surge of 3.56 percent in consumer prices over the last month, a record so far, was attributed to the market fluctuation after the Lunar New Year festival, the natural disasters and epidemics, the economy’s low capacity to absorb the strong foreign investment flow.

An official from the Price Management Department of the Finance Ministry, Nguyen Tien Thoa, also attributed the situation to the unhealthy manifestations of the credit system and the strong fluctuation of the real estate market.

Especially, economists have been doubtful about the optimistic forecast by the Domestic Market Management Group of a 0.1-0.2 percent reduction in consumer price index in March after a recent price hike of petrol and oil. The doubt is based on the increasing trend of the world oil price and the impacts of the price adjustment process directed by the market forces on some domestic important materials.

Finance Minister Vu Van Ninh agreed that a new price level has been formed on the domestic market, adding “we have to accept it”.

However, he consoled that the Government will assist those who are most influenced by the oil and petrol hike.

Ninh also said the Government is working out synchronous solutions, giving special attention to the balance of supply-demand and expenditure control.

Meanwhile, the Ministry of Industry and Trade is considering an “emergency mechanism” to stabilise the market in a case of strong fluctuation in supply-demand due to natural disasters, epidemics, or partial imbalance.

Over the past two months, the bright colour of the economy was seen in exports with a turnover of 8.7 billion USD, a year-on-year increase of 29 percent.

During the period, the flow of foreign investment capital poured into Viet Nam surged by 40 percent to 2.65 billion USD. More and more foreign investors are interested in doing business in the country’s localities.

The industrial production value also exceeded 99 trillion VND (6.19 billion USD) with the growth reported by all State-run, non-State and foreign-invested sectors.
Source: Vneconomy