Vietnam’s PM Urges Focus on Growth With Inflation Under Control

2023-06-03 18:19

Vietnam needs to prioritize growing the economy with inflation under control and its export-dependent businesses struggling with declining

Vietnam needs to prioritize growing the economy with inflation under control and its export-dependent businesses struggling with declining orders, Prime Minister Pham Minh Chinh said during the government’s monthly meeting on Saturday in Hanoi.

Inflation in May quickened 2.43% from a year ago, the lowest level in 14 months, according to government data. But the government has reported further risks of a growth slowdown with exports contracting for a fourth month and a local property market facing a continuing crisis.

The government previously focused on curbing inflation over growth “in order to avoid impacts on citizens’ lives and that was the right decision,” Chinh said, according to a posting on the government’s website.

Chinh ordered ministers and central bank officials to prioritize policies to boost growth as businesses continue to struggle with reduced orders from overseas and cash flow problems.

The nation may see an improving economic picture in the second quarter, a separate government posting said, citing Minister of Planning and Investment Nguyen Chi Dung. Nonetheless, businesses are expected to continue facing headwinds while investments and property projects will still endure delays, Dung said.

The prime minister directed government officials to ease bottlenecks to boost production, the finance ministry to work on measures to promote the development of the corporate bond market and the construction ministry to ease difficulties in the property market, according to a statement from the monthly government meeting.

Chinh repeated calls for the government to reduce or delay tax payments and fees, and for banks to restructure loans and lower lending rates. He reiterated his order for the central bank to help businesses access loans while ensuring the liquidity and safety of the banking system.

The premier also directed the trade ministry to look to boost trade with new markets, including India, the Middle East and South America.

Vietnam’s government, in another statement, said it would begin negotiations for a free trade agreement with the United Arab Emirates at the ministerial level early next week.