The unfavorable and unpredictable developments in the global geopolitical situation, along with increasing pressure on exchange rates, domestic inflation, and the difficulties faced by the business community, are putting significant pressure on macroeconomic management and socio-economic development in the remaining quarters of 2024.
In this context, the Prime Minister issued Directive No. 12/CT-TTg on key tasks and solutions to promote socio -economic development, urging ministries, sectors, and localities to strive to overcome challenges, achieve the highest and best results, and aim to meet and exceed the set targets and indicators, especially those related to growth and inflation control.
Although the first quarter of 2024 started favorably with GDP growth exceeding the projected scenario, new external factors have emerged that adversely affect the domestic situation. These include security and political instability in many countries and regions, leading to instability in global markets, disrupting supply chains, and reducing demand for Vietnamese goods. This reality could directly impact the recovery of exports – one of the main drivers of economic growth.
Regarding inflation, pressure is also increasing as exchange rates continue to rise due to the tense impact of the global situation, compounded by the domestic situation stemming from the implementation of the new wage regime from July 1st, the possibility of price adjustments for some essential goods managed by the State, etc. Therefore, to achieve the growth target of 6-6.5% and curb inflation, and ensure the major balances of the economy, ministries, sectors, and localities need to continue to consistently and steadfastly implement the set goals, viewpoints, and development orientations, and strive to overcome difficulties and challenges to effectively carry out assigned tasks.
In that spirit, the first point of Directive No. 12/CT-TTg emphasizes the task of continuing to promote growth while maintaining macroeconomic stability, controlling inflation, and ensuring the major balances of the economy. Hot and emerging issues such as exchange rate fluctuations and rising gold prices have been addressed in the Directive, along with specific solutions assigned to the State Bank of Vietnam.
That is, timely, flexible, harmonious, and reasonable management of interest rates and exchange rates; timely and effective implementation of solutions and intervention tools to manage the domestic gold market to ensure healthy, open, and transparent competition, and immediately address the high disparity between domestic and international gold prices. The main focus of the policy is also on removing difficulties for the business community, as the Prime Minister has requested accelerated reduction and simplification of administrative procedures, creating a favorable investment and business environment, and continuing to remove obstacles to production, business, and job creation and livelihoods for the people.
Along with that, there are requirements to continue reducing lending interest rates; increasing access to capital for the economy; and absolutely preventing electricity shortages and disruptions in the supply of gasoline and oil under all circumstances... Notably, some tasks assigned by the Prime Minister to ministries to be submitted in May include a new decree replacing previous decrees on gasoline and oil business; extending the deadline for tax payment, reducing registration fees for domestically produced and assembled automobiles, and reducing land and water surface lease fees… to meet the urgent requirements.
Bringing the economy back onto a high-growth trajectory in the current context is a very challenging task, but also a mandate to achieve the 2021-2025 five-year socio-economic development plan with an average growth target of 6.5-7%. Therefore, 2024 has been identified by the Government as a year of acceleration and breakthrough, and economic growth has become the most important task, alongside maintaining macroeconomic stability, controlling inflation, and ensuring major balances. Directive No. 12/CT-TTg once again reiterates the key priority tasks to urge ministries, sectors, and localities to work together and resolutely implement them effectively.
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