24 Oct 2009

NA deputies discuss second stimulus




HA NOI — The economic stimulus package, restructure and a report on the socio-economic situation were at the top of the National Assembly’s meeting agenda yesterday.
Deputy Le Quoc Dung said the country faced difficulties caused by the economic recession but the Government had made great efforts to help it overcome and maintain its growth rate.
He praised the Government’s efforts to prevent bankruptcies and keep stability at a time when firms in other countries were going to the wall.
Deputy Nguyen Ngoc Hoa, from HCM City, said that while the growth rate was on target it would have been higher if the country had exploited its resources better.
"We just spend money to buy growth; we need administrative procedure reform," he said.
Most deputies agreed the economic stimulus package should be stopped by the end of the year, despite its positive effects. Only 20 per cent of companies had received the 4 per cent interest rate subsidy.
Such a move would help reduce waste in the State budget and remove distortions from the monetary market.
It was recommended, however, that the Government continue to support developing agricultural infrastructure, rural and urban areas and purchasing equipment and machinery.
"In general, the first stimulus demand package has had practical effects," Hoa said, "but it is necessary to analyse and assess more thoroughly the efficiency of the package by balancing the amount of money spent against the economic growth achieved.
"We still need a stimulus package, not to encourage demand but to boost economic restructuring, and the new package must be long-term – 5-7 years – and concentrated."
He suggested the Government work out criteria for enterprises investing in specific sectors and which had effects on the economic restructuring, to be stimulated.
Deputy Dinh Xuan Thao from Kien Giang Province and Nguyen Ba Thuyen from Lam Dong Province agreed that agricultural processing was still weak and mainly unprocessed food was being exported.
"If we could process, then the profits would be larger and farmers would benefit more," they said.
Therefore, it was critical to have a drastic change in management and orientation to restructure the economy, they said.
Ha Noi’s deputy Nguyen Thi Hoa said attention should be paid to agricultural quality management.
Deputies also raised concerns that it was the first time Viet Nam had a deficit in import-export payment balance, which had led to a shortage of foreign exchange.
Budget overspending was increasing, which would cause inflation if it continued, they said.

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