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Vietnam govt unveils 2013 economic plan

By Business Desk (asianewsnet) Updated: 2012-12-26 10:50

The Vietnam government has announced how it aims to overcome the country's financial difficulties in 2013 against the backdrop of a slowly recovering global economy.

An economic resolution, containing nine measures to improve Vietnam's socio-economic development, was unveiled by Prime Minister Nguyean Tan Dung at a teleconference today between Government leaders and the heads of cities and provinces.

Speaking at the conference, Deputy Prime Minister Hoang Trung Hai emphasised the importance of stabilising the macro economy and controlling inflation next year. He said that the government would focus on dealing with inventories and supporting the market and investment. It was also declared that the proposed package of nine solutions would aim to improve people's standard of living and social security and strengthen State management over land and resources and the fight against corruption.

The resolution revealed that billions of dong would be used to rescue the ailing economy by warming up the real estate market.

The government would review large-scale housing projects to decide which ones should be continued and which ones to be cancelled.

Meanwhile it would create policies that encourage enterprises and individuals to take part in housing development and the State Bank of Vietnam would earmark between 20-40 trillion dong (US$960 million to $1.9 billion) to lend to civil servants, members of the armed forces and people with a low income so that they can buy or rent houses.

New tax policies would also benefit struggling property buyers, with a 50 per cent reduction being implemented on value-added tax charged for the sale, rent or purchase of homes to these groups.

Conditions would be introduced to attract more foreign organisations and individuals to buy and own houses in Vietnam as part of a National Assembly pilot project. If successful they would be signed into Housing Law.

Government solutions

Hai said the Government would help drivers by forgoing the road-user tax for personal vehicles in 2013. He added that vehicle registration fees would be cut from the current rate of 20 per cent to 10 per cent for cars with ten seats or fewer.

The government also set itself the target of increasing its support to enterprises by helping them approach sources of capital, reduce the cost of production and boost consumption. Small and medium enterprises, including housing investment and trade companies, would enjoy an extension of six months for paying income tax and value-added tax.

Interest rates would be cut to reduce inflation and increased credit would be provided to small and medium enterprises and export companies in certain fields.

As for bad debt, the State Bank of Vietnam would check and assess bad debts in every field. It would revise and supplement regulations to support the safety of credit operations and would more closely supervise the operations of credit organisations. Meanwhile, the Ministry of Finance would introduce new measures to solve the bad debts of State-owned enterprises during the on-going process of restructuring.

At the conference, leaders from cities and provinces agreed with the draft resolution but they proposed some additions.

Deputy Chairman of Ha Noi People's Committee Nguyen Huy Tuong called for the Government to implement the programmes as soon as possible. He also proposed that the announced support should be extended until 2014.

He asked the Government to allow bonds worth 5 trillion dong to be issued to solve infrastructural difficulties in 2013.

The Chairman of Hai Phong City People's Committee, Duong Anh Dien, said many enterprises in the city were facing difficulties revoking land for production and business and asked the Government to provide more clarification on the issue.

Le Hoang Quan, the Chairman of HCM City People's Committee asked the Government to support the real estate market as it has a big influence on the other sectors. He said the Ministry of Finance needed to enforce the new resolution in time for the approaching dry season.

At the conference, Deputy Prime Minister Vu Van Ninh and Minister of Planning and Investment Bui Quang Vinh reported the results of socio-economic development in 2012.

The Consumption Price Index reached 6.81 per cent, a figure much lower than in previous years. The country's socio-economic development is still facing difficulties as the GDP growth rate is estimated to reach 5.03 per cent, 0.7 – 1.2 per cent lower than the target.

Ninh said that in order for the country to successfully recover, drastic measures and firm management were needed from leaders at every level - from the Government down to grassroots organisations. He said the dialogue with citizens would be increased to help understand and solve their problems.

The conference is expected to finish today.

*US$1= 20,828 dong

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