The minimum rates may have fallen to 17-19 per cent, but o­nly for companies operating in priority areas like exports, agriculture and fishing. Others still have to pay 21 – 21.5 per cent.

According to Phan Van Thien, deputy general director of Bien Hoa Confectionery Company, with interest rates at more than 20 per cent he expects the prices of his company's products to rise by 10 to 15 per cent during Tet.

Consumption may rise by o­nly 15 per cent against the traditional 25 to 30 per cent, he says.

But interest rate will not go down easily if inflation remains high.

At a seminar o­n Vietnam's economy in 2011 and its prospects for 2012 organised by the Economic Committee of the National Assembly and the Vietnam Institute of Social Sciences in HCM City last week, former trade minister Truong Dinh Tuyen said interest rates could be lowered o­nce inflation falls to single digits.

Meanwhile, the Government should divert resources from State-owned enterprises to the private sector since the former were performing poorly.

Dr Nguyen Duc Thanh, director of the Vietnam National University's Vietnam Centre for Economic and Policy Research, said if interest rates could not be cut, businesses should be supported by cutting income tax by 3 per cent to 22 per cent.