Vietnamese ruling party gives economic advice

HANOI, Apr 7, 2008 (Xinhua via COMTEX) -- -- The Communist Party of Vietnam Central Committee has recommended tighter price control, and a stronger role of the State Bank of Vietnam in overseeing investment, as part of a series of measures to overcome the challenges the national economy has been facing, local newspaper Vietnam News reported Monday.

At a recent meeting discussing socioeconomic issues of this year's first quarter, the committee's Political Bureau stressed the importance of regulating financial and monetary policies, managing the emerging stock and realty markets, strengthening market price control, encouraging production and export, and limiting trade deficit.

As for the state's financial policy, the bureau said measures should be taken to increase the state budget's revenues, while implementing a tight financial policy, cutting down on regular expenses, and increasing the efficiency of investment that fell under the state budget.

The bureau said it was essential to raise export taxes at an appropriate rate on some mineral resources, and increasing import taxes and inland taxes on some non-essential and luxurious consumables. Projects considered less efficient and not urgent will not receive state funds this year, while efforts will focus on key national projects.

The bureau urged the state bank to play a stronger role in closely controlling payment instruments, outstanding loans, lending for trade on the realty and stock markets which are implemented by commercial banks and monetary trading organizations. It stressed that a flexible regulatory monetary policy was needed to ensure a sustainable growth rate and limit outstanding debts.

The bureau also stressed the importance of controlling foreign investment and exchange rates, and implementing measures to anti- dollarize the local economy.

Concerning the control of stock and realty markets, the bureau agreed that it was necessary to closely control bank loans by companies investing in the two markets. It said tax policies should discourage speculation of the realty market.

As part of an effort to foster the management of market prices and balance the supply and demand for commodities, the bureau agreed to strengthen the role of the state in controlling prices, and ask businesses not to increase the price of such strategic products as electricity, oil, gas, cement, steel, coal and water.

The bureau also emphasized the implementation of policies and programs on supporting local people hit by natural disasters and epidemic diseases. The bureau said it was necessary to raise salary rates for public servants, members of armed forces and workers earlier than originally planned.

Efforts should also focus on accelerating administrative reform and temporarily reducing corporate income tax for companies facing difficulties, the bureau said.

Vietnam gained economic growth of 7.4 percent in the first quarter of this year, and consumer price index of 9.19 percent in March.

Morning Coffee with TradingMarkets -- Free Newsletter

More News:   Market Updates | Stock Alerts | All Trading News | Stock Index