Vietnam on track to realize 6% GDP growth target: Deputy PM

Despite the serious Covid-19 situation, Vietnam is likely to realize the GDP growth target of 6% set by the National Assembly. 

Deputy Prime Minister Le Minh Khai gave his remarks at a meeting of the National Assembly’s Standing Committee on June 15.

Khai attributed his projection to the complication of the fresh Covid-19 outbreak which has swept 40 out of 63 cities and provinces due to the appearance of some variants.

In this context, Vietnam’s nominal GDP growth in the first six months of this year is estimated at nearly VND4,000 trillion (US$174.68 billion), or an economic expansion rate of 5.8%.

While the growth remains 0.42 percentage points lower than the government’s target of 6.22% for the six-month period, this shows “a huge effort from the government,” said Khai.

Minister of Planning and Investment Nguyen Chi Dung at the meeting. File photo

Providing a more detailed look on the economic performance, Minister of Planning and Investment Nguyen Chi Dung said the construction – industrial production plays a key part in spurring growth by posting an expansion of 7.85%, followed by services (5%), and agro-forestry-fishery (3%).

Another positive result highlighted by Dung is a sharp rise of total revenue from retail sales and services by 7.1%.

According to Dung, the macro-economic situation continues to serve as a solid base for economic recovery as inflation remains under control, along with stable foreign exchange and monetary markets.

For the January – June period, Dung expected the state budget revenue to reach 55.5% of the year’s estimate, up 10.9% year-on-year and around the same level of pre-Covid-19 period in 2019. Meanwhile, state budget expenditure could be around 43% of the estimate, while disbursement of public investment is set to be around 34.15% of the plan, slightly down from the 34.85% rate recorded in the first half of last year.

Dung said in the final half of 2021, the government would stand firm on pursuing the twin goal of both containing the pandemic and boosting economic recovery.

“The government would gather all necessary resources to provide free vaccines for the public in a bid to achieve herd immunity,” Dung stressed.

Among other priorities, Dung added the government is expected to focus on measures to support people and businesses affected by the pandemic, especially those having lost their jobs, or working at industrial parks.

Dung said the government agencies would be active in addressing shortcomings in legal framework for greater utilization of social resources for development.

Meanwhile, the central government and localities are expected to bolster financial-budget discipline and disbursement rate of public investment fund, while continuing to attract high quality FDI projects, added Dung.

Head of the National Assembly’s Committee for Economic Affairs Vu Hong Thanh. Photo: quochoi.vn

Slow progress of government support packages

Discussing existing government support programs, Chairman of the National Assembly’s Committee for Economic Affairs Vu Hong Thanh acknowledged the slow implementation of certain relief packages, saying a big proportion of vulnerable people and enterprises were not able to access such support.

Thanh referred to the modest disbursement at only 36.5%, or VND13.1 trillion (US$571.6 million) as of May 27 of the financial support package worth VND35.8 trillion (US$1.56 billion).

Meanwhile, only 245 enterprises were qualified for receiving preferential loans totaling VND42 billion (US$1.83 million) to pay workers’ wages via the lending package worth VND16 trillion (US$698 million) from the Vietnam Bank for Social Policies, or a disbursement rate of 0.26%.

Thanh urged the government to review comprehensively supporting policies for beneficiary groups and draft other programs with greater efficiency.

A recent statistical data revealed nearly 98% of enterprises have been affected by the pandemic, but only 2% were able to receive government’s support.

Responding to Thanh’s assessment, Deputy PM Khai has requested the Ministry of Planning and Investment to review the efficiency of government’s supporting programs and draw lessons from the process.

“The government is committed to further providing support for those struggling with the pandemic,” Khai added.