Recent monthly cabinet meeting concludes

The results of the Prime Minister’s regular cabinet meeting with Government ministers were released in Hanoi on July 7.

The Government's June regular meeting is held on July 6 and 7.

The meeting, held on July 6 and 7, aimed to appraise the socio-economic climate in the first half of the year, plans to develop the social economy in the second half of the year and inflation prevention.

Vietnam’s economic did not fall into recession

According to Nguyen Xuan Phuc, Government Office chairman, the Prime Minister directed ministries to continue to concentrate all efforts to prevent an economic downturn, to achieve over five percent GDP growth in 2009, keep macroeconomics stable, ensure social welfare, prevent the return of high inflation - keeping it at around seven percent, and keep budget overspending below seven percent.

At the meeting, Government ministers said that the country’s economy declined in the past six months of the year, but did not fall into recession.

The national economy in the past six months has shown signs of recovery and further development despite challenges and difficulties. The Government’s stimulus package for investment and consumption has had initial success.

The General Statistics Office announced that GDP in the past six months was 3.9 percent against the same period in 2008.

The industrial production value in the six months reached 4.8 percent compared to the same period last year.

The agro-forestry-fishery sector saw an increase of 1.25 percent while industry and construction, and services rose by 3.48 percent and 5.5 percent respectively.

Exports of key commodities in the second quarter also increased and the consumer price index rose at a reasonable rate, the office said.

However, due to effect of the world economic recession and domestic difficulties, GDP growth in the past six months was low, Mr Phuc said.

In addition, natural disasters, epidemic diseases and falling production led to falling job rates and incomes, and environmental damage, Mr Phuc added

The Government needs to have solutions to these problems in the second half of the year, he said.

Some of resolutions approved by the Prime Minister are to promote produce and exports, and pay special attention to the domestic market.

He also approved investment promotion, effective implementation of the economic stimulus package, improve consumer demand to prevent economic recession and recover economic growth; keep agriculture development stable, prevent epidemic diseases, ensure adequate electricity and worker skills; implement financial and monetary policies, keep macroeconomic development stable and prevent inflation returning, with particular special attention to implementing social welfare policy and resolving social issues.

Gasoline prices

At the press conference, most attention was paid to gasoline prices.

Domestic gasoline prices were adjusted twice in June, which caused a public outcry, as world gasoline prices increased a fraction, compared to large increases in the country. 

When world crude oil was US$147 per barrel, domestic gasoline was VND19,000 per liter, but since then crude oil has halved in price though domestic gasoline has only fallen by about a quarter, toVND14,200 per liter.

Nguyen Tien Thoa, head of the Price Control Agency, said the price increases, since September 16, 2008, had followed the market mechanism and domestic petrol prices did not depend on world crude oil.

World gasoline product prices have increased by ten to 24 percent in the last two months, and gasoline sellers still faced difficulties, despite increased gasoline prices at the pumps, Mr. Thoa said.

Government yet to cut stimulus package

Speaking at the press conference, Nguyen Ngoc Bao, head of the Central Bank’s Monetary Policy Department, confirmed that the Government will not yet cut its stimulus package.

According to an evaluation by the Government, the stimulus package and subsidized loans contributed to preventing economic recession and help increase credit by 17 percent in past six months of the year.

Mr. Bao said currently more than 1.2 million households had sought Government backed subsidized loans.

By Ph.Thao - Translated by Ky Linh

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