The important marks in the national economy in 2011 (03/01)
03/01/2012 - 13 Lượt xem
1. Government’s Resolution 11 shows faith in bright future
In late 2010, the National Assembly approved the targeted plan for economic development in 2011 which said the GDP in 2011 needed to obtain 7-7.5 percent, and the consumer price index CPI needed to be lower than 7 percent.
However, in early 2011, anticipating the risks of the high inflation and macroeconomic instability, on February 24, the government issued the Resolution No 11, declaring that the focus of the government in 2011, is to curb inflation and ensure macroeconomic stability. This is considered a reasonable move to prevent the high inflation and aim to sustainable development.
The resolution has brought encouraging results. The inflation rate in 2011 remains high at 18 percent, but it has been put under control and on the decrease, while then GDP growth rate is 6 percent.
2. Restructuring the national economy – a necessary move to develop more strongly
The third Congress of the Communist Party’s Central Committee in October 2011, decided to carry out the restructuring of the national economy. In the next five years, Vietnam will focus on three most important fields. It will restructure the investment with the focus on the public investment; restructure the finance market with the focus on the commercial banking system and finance institutions; and restructure state owned enterprises with the focus on economic groups and general corporations.
In the latest news, three joint banks Vietnam Tin Nghia, De Nhat and Saigon Bank have been merged, while the Song Da Group has become the first state owned economic group that kicks off the restructuring process.
3. Sea-borne economy development issued warmed up again
After the “hot news” about the East Sea, the issue of developing sea-borne economy has been once again discussed. Vietnam needs to make heavier investment to develop sea-borne economy to take full advantage of its rich natural resources to ensure the harmonized development.
In fact, developing sea-borne economy was laid out as a big strategy right in 2007. However, the action plans and projects still have not satisfied the requirements on exploiting and developing the sea-borne economy.
4. The finance and banking: reforming to aim to sustainable development
The banking system once underwent a difficult period in the first months of 2011, when banks jumped into an unhealthy competition. They scrambled for depositors by offering high interest rates, which were higher than the allowed ceiling level of 14 percent. Especially, the “gold fever attacks” and the dollar price fluctuations once made the market scorching hot.
However, the State Bank of Vietnam has been applying drastic measures to put the market in order. Since September, actions have been taken to force the deposit interest rate to 14 percent, stabilize the gold market, support the banks with liquidity problems and stabilize the dong/dollar exchange rate
5. Tightening credit on non-production sector
The policy on tightening the lending to non-production sector has had big influences on the real estate and securities markets.
The VN Index dropped to 350 points by the end of the year, while HNX Index to the deepest low at below 60 points. Stock prices have dropped dramatically, investors have incurred big losses, while securities companies have been facing big difficulties. The real estate market has nearly paralyzed due to the lack of capital, which has forced real estate developers to bargain away their products.
6. A lot of businesses bankrupted – the necessary purification
High lending interest rates, input material price increases, narrowed export markets, people’s expenses cutting down all have put big difficulties for businesses, especially small and medium ones. The Vietnam Chamber of Commerce and Industry (VCCI) has reported that 50,000 businesses have bankrupted or stopped production.
Economists believe that it is a necessary elimination, a creative destruction to choose the best bodies for the new competition period.
7. A lot of black credit default cases discovered
It seems that 2011 is the year which witnessed the highest number of “black credit default cases.” A lot of cases in Hanoi were reported, and then in other provinces and cities such as Thai Binh, Bac Ninh, Nghe An and Quang Ninh where the loss in each case may reach hundreds of billions of dong.
The default cases all have related to the overly hot investment in the gold, securities and real estate markets
8. Electricity, petroleum prices increase in a plan to run competitive markets
In early 2011, despite the high consumer price index increase, the government still had to approve the electricity and petroleum price increases.
Petroleum distributors, including Petrolimex, insisted on increasing petroleum prices, saying that if they do not raise the retail prices, they would continue incurring losses. However, the inspection in December shows that Petrolimex and other distributors did not incur losses, but they made profits.
Regarding the electricity price, though people agree that the price needs to be adjusted, they require to make public the electricity production costs. A power competitive market needs the transparency and a good control by the government.
9. Business environment downgrades
The surveys conducted by prestigious economic institutions all show that Vietnam has lost grades in its business environment. Besides the old problems in infrastructure, labor force and administrative procedures, the problems in the macroeconomic stability have for the first time--warned.
Foreign investors and institutions have said the downgrading in the business environment has discouraged them.
10. Big national construction works completed
The fact that the terminal of the Da Nang airport was put into operation in late 2011 is really the good news. Besides, the HCM City-Trung Luong Highway, the East-West Boulevard and Thu Thiem tunnel, the Son La hydropower plant have also been completed.
However, a lot of projects have still been unfinished, which reflects the “inborn disease” of Vietnam in implementing national construction works.
Source: VEF
In late 2010, the National Assembly approved the targeted plan for economic development in 2011 which said the GDP in 2011 needed to obtain 7-7.5 percent, and the consumer price index CPI needed to be lower than 7 percent.
However, in early 2011, anticipating the risks of the high inflation and macroeconomic instability, on February 24, the government issued the Resolution No 11, declaring that the focus of the government in 2011, is to curb inflation and ensure macroeconomic stability. This is considered a reasonable move to prevent the high inflation and aim to sustainable development.
The resolution has brought encouraging results. The inflation rate in 2011 remains high at 18 percent, but it has been put under control and on the decrease, while then GDP growth rate is 6 percent.
2. Restructuring the national economy – a necessary move to develop more strongly
The third Congress of the Communist Party’s Central Committee in October 2011, decided to carry out the restructuring of the national economy. In the next five years, Vietnam will focus on three most important fields. It will restructure the investment with the focus on the public investment; restructure the finance market with the focus on the commercial banking system and finance institutions; and restructure state owned enterprises with the focus on economic groups and general corporations.
In the latest news, three joint banks Vietnam Tin Nghia, De Nhat and Saigon Bank have been merged, while the Song Da Group has become the first state owned economic group that kicks off the restructuring process.
3. Sea-borne economy development issued warmed up again
After the “hot news” about the East Sea, the issue of developing sea-borne economy has been once again discussed. Vietnam needs to make heavier investment to develop sea-borne economy to take full advantage of its rich natural resources to ensure the harmonized development.
In fact, developing sea-borne economy was laid out as a big strategy right in 2007. However, the action plans and projects still have not satisfied the requirements on exploiting and developing the sea-borne economy.
4. The finance and banking: reforming to aim to sustainable development
The banking system once underwent a difficult period in the first months of 2011, when banks jumped into an unhealthy competition. They scrambled for depositors by offering high interest rates, which were higher than the allowed ceiling level of 14 percent. Especially, the “gold fever attacks” and the dollar price fluctuations once made the market scorching hot.
However, the State Bank of Vietnam has been applying drastic measures to put the market in order. Since September, actions have been taken to force the deposit interest rate to 14 percent, stabilize the gold market, support the banks with liquidity problems and stabilize the dong/dollar exchange rate
5. Tightening credit on non-production sector
The policy on tightening the lending to non-production sector has had big influences on the real estate and securities markets.
The VN Index dropped to 350 points by the end of the year, while HNX Index to the deepest low at below 60 points. Stock prices have dropped dramatically, investors have incurred big losses, while securities companies have been facing big difficulties. The real estate market has nearly paralyzed due to the lack of capital, which has forced real estate developers to bargain away their products.
6. A lot of businesses bankrupted – the necessary purification
High lending interest rates, input material price increases, narrowed export markets, people’s expenses cutting down all have put big difficulties for businesses, especially small and medium ones. The Vietnam Chamber of Commerce and Industry (VCCI) has reported that 50,000 businesses have bankrupted or stopped production.
Economists believe that it is a necessary elimination, a creative destruction to choose the best bodies for the new competition period.
7. A lot of black credit default cases discovered
It seems that 2011 is the year which witnessed the highest number of “black credit default cases.” A lot of cases in Hanoi were reported, and then in other provinces and cities such as Thai Binh, Bac Ninh, Nghe An and Quang Ninh where the loss in each case may reach hundreds of billions of dong.
The default cases all have related to the overly hot investment in the gold, securities and real estate markets
8. Electricity, petroleum prices increase in a plan to run competitive markets
In early 2011, despite the high consumer price index increase, the government still had to approve the electricity and petroleum price increases.
Petroleum distributors, including Petrolimex, insisted on increasing petroleum prices, saying that if they do not raise the retail prices, they would continue incurring losses. However, the inspection in December shows that Petrolimex and other distributors did not incur losses, but they made profits.
Regarding the electricity price, though people agree that the price needs to be adjusted, they require to make public the electricity production costs. A power competitive market needs the transparency and a good control by the government.
9. Business environment downgrades
The surveys conducted by prestigious economic institutions all show that Vietnam has lost grades in its business environment. Besides the old problems in infrastructure, labor force and administrative procedures, the problems in the macroeconomic stability have for the first time--warned.
Foreign investors and institutions have said the downgrading in the business environment has discouraged them.
10. Big national construction works completed
The fact that the terminal of the Da Nang airport was put into operation in late 2011 is really the good news. Besides, the HCM City-Trung Luong Highway, the East-West Boulevard and Thu Thiem tunnel, the Son La hydropower plant have also been completed.
However, a lot of projects have still been unfinished, which reflects the “inborn disease” of Vietnam in implementing national construction works.
Source: VEF
