(MPI Portal) – On October 17th, Minister of Planning and Investment Bui Quang Vinh had a meeting with Mr. Sanjay Kalra, Chief Representative of the International Monetary Fund (IMF) in Vietnam. There were participations of Mr. Do Thuc, General Director of the General Statistics Office, and representatives of relevant units of the Ministry.
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Minister Bui Quang Vinh meets Mr.Sanjay Kalra Chief Representative of IMF in Vietnam. Photo: Duc Trung (MPI Portal) |
At the meeting, the Minister Bui Quang Vinh appreciated the role of the IMF for Vietnam. Vietnam has increasingly integrated into the world economy so that it was also affected by the fluctuations of the world economy.
The Minister said, in the recent time the State Bank of Vietnam had strong monetary measures to stablize macro-economy such as the tightening of credit. Credit outstanding in 2010 was over 30%, 12-14% in 2011, the first 6 months of 2012 was negative, and currently being at low level with 1-2%. CPI has continuously decreased since 2011. However, it caused considerable impacts on enterprises (over 40,000 enterprises were dissolved, suspended, etc.), budget reduction, unemployment, affecting social welfare.
Credit growth target set in 2012 was 15-17%, but in the first 6 months of the year, credit growth was negative (this indicator was expected at only 6-8% in 2012). High inflation risk has continued to trigger difficulties for enterprises especially in the field of real estate, bad debts is continuosly rising.
In the first 6 months of 2012, credit interest fell, but it is still hard for enterprises to access to this capital source, especially SMEs.
The Minister said that there should be a close coordination between the policy-making bodies. Monetary policy must be consistent with fiscal policy. It needs a harmonious balance between macro-economy and growth. "Macroeconomic stability is the No.1 priority," said the Minister.
A series of irrational policies in recent time was identified by the Minister including: unreasonable balance between accumulation and consumption; chasing high growth leading to macroeconomic instability; scattered investment decentralization; the construction of too many economic zones, industrial parks in the condition of limited resources leading to inefficient investment; besides dispersed and asynchronous policy-making.
The Minister agreed with the monetary policy the State Bank of Viet Nam in recent years with the goal to rationalize credit balance, resolving bad debts and disbursing continuously in 12 months.
Finally, the Minister stressed that Viet Nam needs to strengthen total productivity, using science and technology to increase the competitiveness of the economy.
IMF representative in Vietnam, said that during recent years Vietnam has had too many targets for economic development as growth target, inflation reduction target, credit growth target, ... According to him, the Government of Vietnam should take out nationaly main targets.
Mr. Sanjay Kalra also gave recommendations that Viet Nam should not accept a low growth target, it should be put on a higher growth target because Vietnam has young, potential and abundant labor force, political stability, important position in the region.
The two sides agreed that in the future cooperation between Vietnam and IMF should be increasingly closely through regular discussions on judgments about the world economic situation, macro solutions./.