MPI: Growth target challenging but attainable

Jun 12, 2017 | 11:18 AM GMT+7

Minister tells NA that 6.7% target remains within reach.

MPI: Growth target challenging but attainable

Minister of Planning and Investor Nguyen Chi Dung has said the economic growth target of 6.7 per cent for this year is a tough goal but can still be achieved.

Addressing a skeptical National Assembly (NA) in Hanoi on June 9, the Minister said it’s important for the economy to keep expanding at a rapid pace or it will fall behind Vietnam’s regional peers.

“The target is challenging. But with the right plan at the right time, the country can hit it,” he said during the NA’s June 9 session.

The government is concerned that another slowdown would cast doubt over the country’s ability to maintain its position among Asia’s fastest-growing economies.

Several legislators had pressed Minister Dung on whether the target was realistic, with some questioning the government’s plan to boost growth by increasing the crude oil output.

Mr. Nguyen Tuan Anh, delegate for southern Binh Phuoc province, said that, to keep the economy growing, local companies should be provided with the best environment in which to thrive.

Without strong companies, economic growth will be affected and the country “will have to pump several million more tons of crude oil to boost GDP,” he said.

This is not the first time that NA delegates have voiced their concerns over growth.

When the legislature began its summer session in late May, the government’s mining-focused path was also questioned, with some delegates asking that the government choose other alternatives for achieving growth targets in order to ensure a sustainable future.

Cabinet members last week confirmed that they would try to meet the annual target by tapping oil and gas reserves, after Vietnam’s economic growth in the first quarter hit a three-year low of 5.1 per cent.

But Minister Dung reminded legislators that increasing crude oil output is only a temporary solution.

“The unwavering stance of the government is that growth won’t be pursued at all costs, not at the cost of stability and sustainability,” he said.

Vietnam’s economy is projected to expand 6.5 per cent this year, the Asian Development Bank said in a report released in early April, adjusting its forecast of 6.3 per cent made in September last year. The bank said growth could pick up to 6.7 per cent next year.

In an interview with foreign media late last month, Prime Minister Nguyen Xuan Phuc said he is confident that Vietnam’s economic growth will meet the goal of 6.7 per cent, despite weak expansion in the first quarter.

“The main economic indicators in May are all very good with a strong pickup in exports, foreign investment, and agriculture production, laying the ground for faster growth in the third and fourth quarters,” he said.

Late last week, fresh from his visit to the US and ahead of his trip to Japan to boost trade and investment, the PM threatened to take strong action.

He told a cabinet meeting that officials responsible for each industry will be tied to specific growth targets.

Those who are unable to achieve the expected goals will face punishment, with leeway only given in the event of natural disasters.