Find alternative motivations to achieve the “dual goals”

VCN - The Government requires that ensuring "dual goals" is a consistent task but ensuring people's lives and health is the top task. According to economic expert Can Van Luc, at this time, the Government should develop economic recovery scenarios as well as find alternative driving forces for sustainable growth.
Vietnam's economy: Flexibility with “dual goals Vietnam's economy: Flexibility with “dual goals"
Specific goals in COVID-19 fight needed to avoid crisis: PM Specific goals in COVID-19 fight needed to avoid crisis: PM
Da Nang Customs reaches “dual goals” Da Nang Customs reaches “dual goals”
Dr. Can Van Luc
Dr. Can Van Luc

How do you evaluate the implementation of "dual goals" for the Vietnamese economy in the first months of the year?

Talking about the positives, although the pandemic is still complicated in the world and in Vietnam, the situation in our country is still under control. The vaccination policy is being promoted.

Moreover, the global commodity prices increased quickly but inflation was still well controlled.

In the first six months, inflation increased by 1.64% over the same period last year. At this rate, the annual average inflation is forecast to be around 3%.

In terms of trade, imports and exports grew well. Monetary policy to support businesses is also favorable when the exchange rate is stable and interest rates are on a positive downward trend. However, we cannot loosen interest rates too much because it is related to shifting investment channels and controlling inflation.

However, we need to cope with, identify, and control many challenges such as the pandemic, trade wars, natural disasters, floods, asset “bubbles”, and global financial instability. Regarding foreign direct investment (FDI), Vietnam always hopes for a shift in investment flows, but registered FDI in the first seven months decreased by 11% compared to the same period last year, while realized capital increased by nearly 4%.

Looking at the investment flows from China and Hong Kong to Vietnam, there was an increase over the same period last year, but the capital flow now is decreasing by nearly 50%.

Meanwhile, disbursement of public investment has been markedly slow. The number of newly established businesses in July increased by 0.7%, while the number of businesses shutting down was significant. Additionally, in banks, bad debts are at risk of increasing, and the restructuring of the economy has progressed slowly.

In your opinion, how can we flexibly overcome difficulties and achieve "dual goals" as planned?

The pandemic and its impact on the economy are still unpredictable to make an appropriate adjustment. Although GDP growth in the second quarter reached 6.61% and the first six months was estimated at 5.64%, much higher than the growth of 0.39% and 1.82% of the same period last year, but several socio-economic indicators already reflected the negative impact of the pandemic.

Therefore, Vietnam must persevere and flexibly implement the "dual goal" of both effective pandemic prevention and socio-economic recovery and development. Continuing to effectively prevent and control the pandemic, along with speeding up the vaccine progress, remains the top priority now.

The Government, ministries, branches, and localities need to urgently deploy support packages for people and businesses, as well as evaluate, research, and propose additional options and support packages.

Simultaneously, the Government should develop a strategy for socio-economic recovery and development in the "new normal" after the pandemic to actively take advantage of strong recovery opportunities as well as control arising risks, such as rising prices, inflation, and disruptions in supply and labor chains. Only then can we achieve the goals of socio-economic development for the 2021-2025 period and in the longer term.

Moreover, to meet the "dual goals", we need to look for alternative and complementary growth drivers and green recovery policies such as accelerating the disbursement of public investment; improving the business - investment environment; boosting domestic market demand; and accelerating the development of the digital economy. This requires strategic institutional breakthroughs, and consistency in human resources and infrastructure for implementation.

In addition to the existing support packages, what solutions do you suggest to support people and businesses at this time to increase economic recovery?

In my opinion, the Government should consider expanding the scope of beneficiaries to all informal workers (self-employed) with a subsidy of VND1 million/person with a scale of VND29,300 billion, excluding the specific support from localities according to Resolution 68/NQ-CP. Because the total number of employees in 2020 was 54.6 million people, of which about 29.3 million people (53.7%) are self-employed.

For the electricity bill support package, relevant agencies should continuously reduce electricity bills for people and businesses, equivalent to the first reduction in 2020 (about VND9,300 billion).

Accordingly, the Electricity of Vietnam (EVN) may consider expanding the beneficiaries, with an additional reduced budget of about VND6,800 billion. The telecommunications support package, announced with an estimated value of about VND10,000 billion, is mainly to increase benefits and incentives for customers, not directly reduce telecommunications charges. Therefore, this support package only affects certain customers. Thus, the best way to support is to reduce telecommunications charges by 20-30% for about three months (in the third quarter of 2021), so it will be included in the cost of businesses, making the support more practical.

Additionally, authorities need to urgently remove bottlenecks and disruptions in supply and production chains for people and businesses. For the people, to prevent disruption of the supply chain of essential goods and services, it is necessary to be more consistent in how the checkpoints and shippers operate in social distancing locations, to avoid the current lack of synchronization.

For businesses, the "two on-site, one green" model (eat and work at the business, live in another safe place, which can become an isolated place when needed, or businesses can arrange another quarantine place) is very effective and appropriate. It is being applied by Thailand under a program called "Factory Sandbox".

In particular, in addition to the VND20,000 billion support package proposed by the Ministry of Finance, the Government needs to increase access to liquidity support capital for businesses. Some basic conditions such as loan support interest rate of about 4%/year are implemented through commercial banks or business development funds, with the guarantee of credit guarantee funds. The total value of the above additional support packages will be about nearly VND40,000 billion (0.62% of GDP in 2021), not to mention that the value of support will increase when current policies are adjusted and extended.

Thank you, sir!

By Xuan Thao (recorded)/ Ha Thanh

Related News

Vietnam

Vietnam's economy is recovering well

VCN - According to Dr. Nguyen Quoc Viet, Deputy Director of the Vietnam Institute for Economic and Policy Research (VEPR), by the end of the third quarter of this year, Vietnam's economy had recovered relatively well amid optimism about the overall growth of the world economy in late 2024 and 2025.
Vietnam - UAE trade grows to billions of dollars

Vietnam - UAE trade grows to billions of dollars

VCN - Updated by the General Department of Customs by the end of September 2024, bilateral trade between Vietnam and the United Arab Emirates (UAE) sees a year-on-year increase of more than US$1.4 billion to nearly US$5 billion
Ministry of Finance proposes to choose the option of reducing land rent by 30% in 2024

Ministry of Finance proposes to choose the option of reducing land rent by 30% in 2024

VCN - The Ministry of Finance has just completed the draft Decree of the Government regulating the reduction of land rent in 2024. Accordingly, in the latest Draft, the Ministry of Finance directly proposed to choose the reduction level according to option 2 of 30%.
Accelerating green transformation for businesses

Accelerating green transformation for businesses

VCN - The green transformation of enterprises is facing many barriers due to the lack of specific regulations and detailed instructions, leading to delays compared to the international market.

Latest News

Many factors affecting tuna exports in the last months of the year

Many factors affecting tuna exports in the last months of the year

VCN - Tensions between Israel and Iran escalate, tuna businesses are worried, they may have to stop export orders to the Israeli market in the last months of the year.
Vietnam still dominates Philippine rice import

Vietnam still dominates Philippine rice import

Vietnam continues to assert its dominance as the top rice exporter to the Philippines, with 2.91 million tonnes shipped as of the late October, or over 79% of the Philippines' total rice imports, according to the Vietnam Trade Office in the Philippines.
Vietnam cements ties with partners to engage in global semiconductor, AI industries

Vietnam cements ties with partners to engage in global semiconductor, AI industries

By boosting cooperation with reputable partners across the globe, Vietnam is taking steps to gain a foothold in the world’s semiconductor and artificial intelligence (AI) industries.
Aquatic exports expected to rise in year-end despite challenges

Aquatic exports expected to rise in year-end despite challenges

Aquatic exports is expected to surge in the remaining months of this year, as the year-end festive season comes, despite many challenges in the international markets, according to insiders.

More News

Trade Defense: The Key to Success for Vietnamese Businesses

Trade Defense: The Key to Success for Vietnamese Businesses

VCN - From losses and near bankruptcy, many domestic enterprises have recovered thanks to timely application of trade defense measures. Trade defense is also an effective shield for Vietnamese enterprises against a series of lawsuits from importing countries, thereby maintaining advantages and developing on "away grounds".
Lao Cai Customs sees a triple-digit surge in export-import turnover

Lao Cai Customs sees a triple-digit surge in export-import turnover

VCN - Updated from the beginning of the year to October 24, total import and export turnover through Lao Cai Customs Department increased by 102%.
Coconut is expected to become a billion-dollar export item

Coconut is expected to become a billion-dollar export item

VCN - Talking to the press at the ceremony to launch the first train carrying fresh coconuts to China, Mr. Luu Van Phi, Director of the Department of Industry and Trade of Tien Giang province, said that Vietnam's agricultural export potential, especially fresh coconuts, is expanding with the appearance of international railway transportation from Song Than station.
Plastic exporters interested in converting to recycling technology

Plastic exporters interested in converting to recycling technology

VCN - The Vietnamese plastics industry is facing major challenges in terms of plastic waste and recycling needs. Secretary General of the Vietnam Plastics Association Huynh Thi My (pictured) shared important information about the transformation in production of plastics enterprises to meet increasing export demands.
Logistics sector must embrace innovative trends to stay competitive

Logistics sector must embrace innovative trends to stay competitive

The Vietnamese logistics industry must adapt to new trends and enhance infrastructure to remain globally competitive, speakers said at an event in Ho Chi Minh City on October 31.
Vietnam’s agro-forestry-aquatic product exports likely to set new record

Vietnam’s agro-forestry-aquatic product exports likely to set new record

Vietnam’s agro-forestry-aquatic product exports are likely to achieve a record high of 62 billion USD in 2024, said Deputy Minister of Agriculture and Rural Development Phung Duc Tien.
UKVFTA greatly benefits Vietnam-UK trade: Experts

UKVFTA greatly benefits Vietnam-UK trade: Experts

The UK-Vietnam Free Trade Agreement (UKVFTA), signed into law three years ago, has clearly benefited trade cooperation between the two countries, particularly in the context of Vietnam’s exports to most other major markets declining due to geopolitical tensions and headwinds in the global economy, said experts at a conference in Hanoi on October 30.
Agricultural exports likely to exceed 60 billion USD amid challenges

Agricultural exports likely to exceed 60 billion USD amid challenges

With swift production recovery and continued growth, Vietnam's agricultural sector could potentially surpass the 60 billion USD export target, according to the Ministry of Agriculture and Rural Development (MARD).
Vietnam-Philippines trade likely to exceed 8 billion USD for first time

Vietnam-Philippines trade likely to exceed 8 billion USD for first time

With the current rising trend, trade between Vietnam and the Philippines is likely to exceed 8 billion USD for the first time to hit about 8.5 billion USD in 2024, with Vietnam’s surplus of more than 3 billion USD, according to the Vietnamese Trade Office in the Philippines.
Read More

Your care

Latest Most read
Many factors affecting tuna exports in the last months of the year

Many factors affecting tuna exports in the last months of the year

VCN - In recent years, Israel has always been Vietnam's leading tuna export market after the US and the EU. Therefore, the recent escalation of Israel-Iran tensions is affecting Vietnam's tuna exports to this market.
Vietnam still dominates Philippine rice import

Vietnam still dominates Philippine rice import

Vietnam continues to assert its dominance as the top rice exporter to the Philippines, with 2.91 million tonnes shipped as of the late October, or over 79% of the Philippines' total rice imports, according to the Vietnam Trade Office in the Philippines.
Vietnam cements ties with partners to engage in global semiconductor, AI industries

Vietnam cements ties with partners to engage in global semiconductor, AI industries

By boosting cooperation with reputable partners across the globe, Vietnam is taking steps to gain a foothold in the world’s semiconductor and artificial intelligence (AI) industries.
Aquatic exports expected to rise in year-end despite challenges

Aquatic exports expected to rise in year-end despite challenges

Aquatic exports is expected to surge in the remaining months of this year, as the year-end festive season comes, despite many challenges in the international markets, according to insiders.
Trade Defense: The Key to Success for Vietnamese Businesses

Trade Defense: The Key to Success for Vietnamese Businesses

VCN - From losses and near bankruptcy, many domestic enterprises have recovered thanks to timely application of trade defense measures. Trade defense is also an effective shield for Vietnamese enterprises against a series of lawsuits from importing countr
Mobile Version