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Pumping capital should match administrative reform (12/10)
12/10/2012 - 13 Lượt xem
Finance
and banking expert Le Van Hinh said "falling interest rates and
increased credit should ensure harmony between the benefits of the
micro and macro economy. Enterprises should also be more prudent with
their capital".
Over
the past decade, Vietnam's economy has recorded a quite fast growth
rate with an average GDP growth of seven percent from 2001 to 2010.
However, economic experts and domestic and foreign financial
institutions pointed out that one weakness of Vietnam economy is
capital imbalance.
Statistics
showed that Vietnam economic growth was high while accumulated funds
inside the country are low. Domestic savings of Vietnam's economy is
often from 30-32 percent of GDP while total social investment is from
40-45 percent of GDP which means the "savings-investment" balance of
Vietnam is minus 15 percent of GDP and the economy is usually in the
state of capital shortage.
Many
experts while monitoring Vietnamese enterprises over a long period said
in the context of numerous difficulties facing the economy, Vietnamese
enterprises rarely reviewed their production process and took optimal
measures to cut costs. In contrast, when businesses made profits, many
of them bought luxury commodities such as airplanes or expensive cars
to make boast of their material things. This is obviously imprudent and
inefficient behaviors with their own capital. It not only made a
negative impact on financial situations of enterprises themselves but
also on their capital making capabilities in the long term and also on
monetary market, making high demand for capital and increasing interest
rates.
At
the moment, lowering interest rates and loosening lending conditions to
save enterprises should go along with a basic and sustainable solution
which requires enterprises to make administration reforms and
restructure their organizations and areas of production and business.
Accordingly, production factors including capital, labor and natural
resources should be combined in harmony to create new values for the
society. This will not only bring benefits to enterprises but to the
whole economy, creating unanimity in enterprises' innovation activities
and transformation of economic growth model in the coming years.
If
lowering interest rates too fast and lower than the balanced level of
the market would probably maintain the existence of enterprises but
they might also follow the old path, which is using their capital
inefficiently. Therefore, lowering interest rates, loosening lending
conditions and increase credits to the economy should match the above
requirements for enterprises and restructuring for the commercial
banking system.
In
addition, falling interest rates and increased credit too easily may
save enterprises out of difficulties in the short term but in the
medium term may lead to inflation and macro-economic instability.
Therefore, falling interest rates to pump capital for enterprises needs
to ensure harmony between micro and macro economic criteria and
enterprises need to change their thoughts and be more prudent with
social capital resources to pursue sustainable economic growth./.
Source: VEN.
Source: VEN.
