In late 2007, in order to curb inflation, the government decided to not raise the prices of essential goods like electricity, petrol, coal, clean water, airfare and fares for train and bus services till the end of June 2008. Experts are worried that after a long time under strict control, the prices of many kinds of goods will increase after June 30.

“Price schemes for the post-June period are being considered towards diminishing difficulties for consumers, producers and stabilising macro-economics. In this bad situation, we have to choose the less bad scheme,” Nghiep said.

According to Deputy Ministry of Industry and Trade Nguyen Thanh Bien, rumours that the prices of many kinds of goods will rise after June 30 are groundless. Learning experience from the recent rice speculation case, the Ministry is working out legal documents to punish goods speculators.

About the worry over the devaluation of the Vietnam dong (VND) against some major foreign currencies, Vice Governor of the State Bank of Vietnam Nguyen Dong Tien said the value of a currency depends on foreign currency reserves and the balance of payment. In 2007, Vietnam’s foreign currency reserve doubled. In early 2008, the reserve was maintained. The country’s balance of payment is forecast to be in surplus.

“These are important bases, from which we confirm that the value of the VND will be stable. In monetary investment, investors need to be watchful before making decisions, to avoid the recent situation, under which many people rushed to buy USD at high prices and suffered losses after that,” Tien said.

According to an official of the Ministry of Planning and Investment, besides satisfactory results in industrial production and foreign investment, several big problems emerged in May. The consumer price index (CPI) increased highly, at 5.3%; gold and USD prices dramatically fluctuated; the trade deficit was more than $14.4 billion, higher than the total trade deficit of 2007; the implementation and disbursement of state-funded projects was very slow.

Chairman of the Government Office Nguyen Xuan Phuc said the Prime Minister asked cabinet members to be more responsible and take immediate measures to curb inflation. Ministries and related state agencies need to widely announce the results of monetary tightening measures.

Phuc said as the CPI increases, people’s lives are getting harder. “At this moment, there are more than 161,000 hungry households, double the number of the same period of 2007. The government decided to allocate 23,000 tonnes of rice to people in remote and isolated areas and natural calamity-stricken regions,” he said.

The Prime Minister confirmed that the government would not let any person go hungry. He told competent agencies to compile hunger eradication and poverty elimination plans for 58 districts which have poverty rates of over 50% and submit the plans in June.

The Prime Minister instructed related agencies to determine their responsibility in the high CPI in May and the recent rice “fever”.

At the cabinet meeting in May, cabinet members heard reports on the draft bill on Administrative Formalities, anti-corruption tasks, inspections of ineffective projects and saving public spending, etc.
Source: Vietnamnet