2019 economy will continue positive trend

	Size of Vietnam’s economy expands by 1.3 folds in three years: PM
	Vietnam remains fastest-growing ASEAN economy: Standard Chartered
	Economic outlook for 2019 to see positive signs

Economic expert Le Dinh An

What do you think about the Government's 2019 socio-economic development goals?

Overall assessment of the economic picture 2019 through the Government targets and through the economic reality 2018, I think that the 2019 economic growth is still positive, economic growth is still good, but motivations, factors supporting growth may change, as these factors have not been sustainable in the past. In addition, the business environment with the pressure of innovation, reform now will be better, creating conditions for businesses to develop.

The determination of the Party, the Government and the National Assembly to improve the business environment has created a stir among the business community. In addition, with the signed trade agreements, business practices, development strategies, thinking of enterprises as well as thinking in economic management will also be renovated, thereby facilitating the production of business of domestic enterprises to develop. With the CPTPP alone,in 2019 this agreement has no impact on the economy, mainly to motivate, create an atmosphere of excitement in business.

Fisheries will remain one of the key export items of Vietnam in 2019

However, it should be noted that there are some difficulties and obstacles of the economy in 2018 to change. These include: Factors for unsustainable growth, still heavily dependent on FDI. Accordingly, FDI exports accounted for 72% of total exports, FDI in manufacturing accounted for over 90%. Growth depends on large FDI enterprises such as Samsung, Formosa... Reforming the growth model is progressive but not the perfect picture while still dependent on FDI, thus enhancing the economic strength will be limited. Restructuring and development of SOEs, especially the equitization of SOEs are slow, and SOEs are currently operating at low efficiency, cumbersome and inactive, while it is very embarrassing that private enterprises and SMEs have not been paid much attention to, suing them for access to capital and land.

In your opinion, how will the picture be for equitization of SOEs in 2019 when the State Capital Management Committee for businesses starts operation?

Before the Committee was established, the separation of state management from production and business activities to create favorable conditions for the effective operation of SOEs was proposed. However, over time this problem has been deployed too slowly, even has stepped backwards. At present, we are opening up the trend of separating production from state management which was not done previously, but now many managers focus on one management unit. It is hoped that the Committee will manage state capital in enterprises under the market mechanism, without affecting the production and business process, only monitoring and speeding up state capital flow for enterprises effectively, otherwise capital will be wasted. Second, the restructuring of business includes the restructuring of personnel and the restructuring of governance, the process that the Commission should not interfere with, because intervening is just the same as the previous management method, so it is not successful. The management of enterprises under the market mechanism will create conditions for SOEs. I think that in the first year of operation, the Committee should not change the picture of equitization of SOEs. To effectively equitize SOEs, the Innovation and Enterprise Development Steering Committee must first be reformed according to new thinking. In addition, the asset valuation structure must also follow new thinking, in accordance with new standards; in my opinion, we cannot seek perfection in the process of equitization of SOEs.

2019 GDP is expected to increase by 6.6-6.8%. Please tell me your opinion on this indicator?

I suppose that the GDP growth target of 2019 set out by the Government is modest. This goal is to create stability for growth and to stabilize the balance of the economy and be able to do so if the situation is relatively good. For example, Samsung has stable production and good production plan, Formosa has increased their production line, put Nghi Son oil refinery and some other works into operation...

In the import-export sector, with trade agreements signed, it is possible to continue to expand the export market for Vietnam, taking advantage of the possibility of 6.6-6.8% as a basis, not to mention that a target of 7% is also likely to be achieved.

In 2019, export growth is forecasted at 7-8%, trade deficit below 3%. But in the past two years Vietnam’s export was surplus, so why are we forecasting for trade deficit in 2019?

In the two years 2016 and 2017, Vietnam export surplus, in which the production in the country was in difficulty, production increased mainly due to foreign investment and strong FDI surplus, while the domestic sector was in deficit due to importing. In the context of the upcoming year, after 30 years of attracting FDI with new orientations in attracting foreign investment, along with creating favorable conditions for domestic production to increase, so the trade deficit should be noted. The government has set up this criterion. In my opinion, the domestic production will increase sharply in the coming time. Accordingly, the import of raw materials for production will increase; newly established enterprises will increase; the domestic production business conditions are also improved and disassembled. From this calculation, the possibility of increasing trade deficit is possible, so the problem posed about trade deficit is also a matter to be noted in the coming time. Trends from 2017 and 2018 in the domestic production are going up and for 2019 we brought to attention the problem of trade deficit, which means the internal force of domestic enterprises will increase. This is a necessary structure because we cannot rely on foreign investment forever. In the opposite direction, if the problem of import restrictions is gradually reduced, in my opinion, domestic enterprises’ strategies and production plans should take into account the priority of production with the available resources of Vietnam. In addition, it is necessary to promote their existing internal resources such as agricultural products, seafood... in exports. In consumption, essential items must be imported, such as gasoline..., the rest should encourage consumption of products in the country, avoid mass consumption of consumer goods.

Industrial production continued to gain positive results at the end of the year VCN- Following the positive growth momentum from the beginning of the year, in the last months of ...

Sir, Vietnam's economy has a great openness, so it should be noted what issues of the world economy will affect the economy in 2019?

In 2019, prices of key materials could raise sharply, especially oil. Conflicts of large countries may push up oil prices, which may put pressure on the exchange rate and inflation of Vietnam. In addition, the currencies of other countries may fall, including the Chinese Yuan (last time this currency fell to 10% in 10 months) greatly affecting and putting pressure on prices, domestic exchange rates, especially financial issues. When these countries have to spend money to restore the exchange rate and the restoration of their currencies, it affects Vietnam. In addition, it is important to note that trade war affects Vietnam due to the openness of the Vietnamese economy, so it should be noted for flexible and reasonable operation.

Thank you Sir!