MPI: economic growth set to hit 8 per cent

However, Phuc said the ambitious growth rate would only be realised if both the domestic and overseas environments were favourable to economic development and if Vietnamese companies found opportunities to boost the level of their exports.
The World Bank last week predicted Vietnam would achieve a growth rate of 7 per cent this year – the second fastest rate in the world behind China.
Phuc said foreign investment would need to be increased and the service sector would have to be developed, while various industries should undertake effective cost-cutting programmes.
Phuc called on all planning agencies to increase their efforts to create a pro-growth environment, so higher economic development would be realised next year.
The National Assembly and the government have set a growth target of between 7.5 and 8 per cent next year.
Agriculture, forestry and fishery production is expected to grow at 4.6 per cent, industrial production should expand by 15 per cent and services by 8 per cent.
Phuc said it was essential to improve the business and investment environment in order to attain these targets. Enterprises would need to reduce production costs and enhance product quality, and the restructure of state-owned enterprises (SOEs) had to be accelerated, Phuc said.
“In industries where SOEs are monopolies, periodic auditing should be put in place and pricing should be strictly monitored, so that the prices of monopolised goods and services could be cut to at least the average levels of the same products manufactured by other countries in the region,” Phuc said.
The government projects that some VND249-255 trillion ($16-16.5 billion) should be raised for investments (by the private or public sector?), representing a rise year-on-year increase of 15 to 16 per cent.
Domestic funds are expected to account for 68 per cent of the amount, while foreign capital should make up the rest.
The Ministry of Planning and Investment has planned to increase state budget financed investment by 13.8 per cent this year, to VND53.5 trillion in 2004, comprising some 21.4 per cent of total national investment.
SOE’s investments are set to mount (increase?) 19.5 per cent to around VND46 trillion, while the domestic private sector is expected to earmark some VND67 trillion, an increase of 15.5 per cent.
The foreign direct investment inflow is also expected to expand in 2004, with VND40.3 trillion predicted to be committed by foreign investors, up about 12 per cent from this year.
An additional sum of VND12.5 trillion would be raised for centrally and locally managed state budgets through the issuance of bonds, the ministry announced.
It also said that a series of solutions to impose stricter control over investment and construction activities would be introduced next year to enhance investment efficiency.