Vietnam in an advantageous position to promote growth and economic stability: Finance minister

All of Vietnam’s key macroeconomic indicators are very positive as of present, which puts the country in a favorable position to facilitate exports, and business/production activities as well as contain inflation, according to Minister of Finance Ho Duc Phoc.

Minister of Finance Ho Duc Phoc.

"This would support socio-economic development and be the most effective solution against inflation," Phoc told the local media.

Phoc said Vietnam's GDP growth is forecast to hit 7% this year. State budget revenue in 9 months reached 95.5% of the yearly estimate; consumer price index (CPI) growth was at 2.58%, below the 4% target set by the National Assembly; public debt at 44% of the GDP, below the 60% threshold; and budget deficit stays under 4%.

Phoc acknowledged that the Federal Reserve (Fed) 's recent move to raise policy rates would impact Vietnam's trade performance and the USD/VND exchange rate.

The minister, however, noted this would be insignificant, given that the USD only made up 13.5% of the country's structures of public debt and transactions in dollars represent only 29% of export-import activities.

"Vietnam could save up to VND57 trillion ($2.38 billion) following the restructuring of public debt," said Phoc.

Regarding recent movements in the bond market, Phoc said the Government had issued Decree No.65 to enhance corporate bond market transparency and better protect investors.

"The local finance market remains healthy and in the right direction for development," Phoc added.

In this context, the criminal proceedings launched against several securities companies due to their illegal actions in the market would not affect investors' rights, Phoc said.

"We are working with bond issuers to ensure investors' lawful rights in case securities companies as consulting service providers are prosecuted. All issuers have committed to pay interest for bonds reaching maturity, and the Government agencies would closely monitor the process," Phoc said.  

More tremendous efforts required

The Standing Committee of the National Assembly (NA), at its meeting today [October 11] discussing Vietnam's socio-economic performance, suggested that the 2022's estimated economic growth of 7-8%, which exceeds the original target of 6-6.5%, would help the country realize the five-year development goals for the 2021-2025 period.

The State budget revenue, which is expected to exceed the annual estimate by 14.3%, will create room for the Government to implement fiscal policies to help grow and improve people's living standards, said Vu Hong Thanh, Chairman of the NA Economic Committee.

However, Thanh expressed concern about volatile developments in the capital and real estate markets, which remain a crucial medium- to long-term capital mobilization channel for the economy.

With the recent arrest of the Chairwoman of Van Thinh Phat Corporation and executives of other companies related to violations in the bond market this year, Thanh called for greater transparency in the bond issuance process and raising bond quality.

"The Government should make a thorough assessment of the situation of the capital market to have appropriate measures to ensure the sustainable, transparent, and healthy development of the monetary and capital market," Thanh said.