In a report delivered at the current second session of the National Assembly in Hanoi on October 22, Mr Dung highlighted major socio-economic achievements in the past nine months, weaknesses of the national economy and major targets set for 2008 

Major achievements

According to the report, despite difficulties caused by natural disasters and epidemics, the agricultural sector has fulfilled the target set for 2007, while the industrial sector has achieved a rather high growth rate contributed by the processing industry. For the first time over the recent years, the services sector has obtained a higher growth rate than the national GDP growth rate. The export sector has also achieved a comparatively high growth rate of 20.5 percent in the first year after Vietnam joined the World Trade Organisation (WTO).   

Major macro-economic balances have been ensured. Total State budget revenue has surpassed the set target, with contributions from taxes and fees making up 23.4 percent. The country’s foreign debts have been maintained at a safe level.

Development investment of the national economy has increased significantly. Many infrastructure and production facilities have been put into operation, creating a prerequisite for the country to develop in the coming years. Total social investment capital in 2007 is estimated to reach VND464.5 trillion, making up 40.6 percent of GDP and increasing by 16.4 percent compared to 2006. With a rapid development, the stock market has become a long-term capital mobilisation channel of the national economy.

In addition, progress has been made in socio-cultural affairs. All targets on education enrolment, education universalisation, job generation, reduction in malnourished children and water supply have been achieved or surpassed. The fight against negative implications of the education sector has received strong public support and had initial results.

Poverty reduction efforts have continuously paid off on a national scale. Programmes to build socio-economic infrastructure facilities in disadvantaged areas and policies to assist the poor have been implemented well. The Bank for Social Policy has received more investment to implement credit programmes for the poor.

Public administrative reform has reaped initial success in several key areas, drawing favourable support from the public and the business community. The Government apparatus has been streamlined towards reducing the number of ministries, agencies and departments, assuming more tasks and increasing responsibility and management efficiency. All ministries, sectors and localities have developed plans of action on the fight against corruption, thrift practice and wastefulness prevention. The Central Steering Committee for Corruption Prevention and Control has made its debut, focussing on implementing the Law on Anti-Corruption and the Law on Thrift Practice and Wastefulness Prevention.  

Mr Dung noted that in the past months, the country’s socio-political stability, national defence and security has been maintained, the fight against crime has been boosted, external relations have continued to expand, and its international position has been lifted. Vietnam has been elected as a non-permanent member of the United Nations Security Council with an overwhelming vote. This has marked a milestone in the country’s active international integration process and affirmed the correctness of the Party and State’s external policy of independence, self-reliance, multilateralisation and diversification of international relations, thereby elevating Vietnam’s position in the international arena. 

Weaknesses identified

However, Mr Dung pointed out weaknesses of the national economy and governance, saying the country has not yet made the best use of new opportunities and not harmonised between economic development and the settlement of cultural, social and environmental issues. Notably, he said productivity, quality and the competitive capacity of products and the national economy as a whole have remained low, investment has proved inefficient, production costs have been high, power generation and supply has not met the demand for development, and the economic shifting has been at a slow pace. Despite the trade deficit being within limits, it has remained rather high for consecutive years without improvements. Tax evasion and wrong spending of the State budget have not been controlled effectively. Analysis, forecasts and supervision of the financial market have failed to keep up with the rapid and sustainable development of the market economy.

Though the export sector has fulfilled its target, its growth rate is lower than in 2006, while import value is higher than in 2006, with import surplus estimated to account for 18.8 percent of total export value. The consumer price index in the past nine months has also increased by 7.32 percent. 

The Government leader also pointed out weaknesses in solving social issues such as job generation, management of food hygiene and safety, vaccines and hospital waste, labour accidents, traffic congestion, compensation for displaced residents, complaints and petitions, environmental protection, as well as other issues which arise during the urbanisation process. 

Major targets set for 2008

Based on targets achieved in 2007 and forecasts for 2008, Mr Dung said the Government has set major socio-economic development targets for 2008 as follows:

-          GDP growth rate: between 85.-9 percent

-          GDP per capita: US$960

-          Social development investment capital: VND567.3 trillion (up 22 percent against 2007 and 42 percent of GDP)

-          State budget revenue: VND321.4 trillion (up 11.5 percent against 2007)

-          Trade deficit: 5 percent of GDP, CPI lower than GDP growth

-          Population: 86.3 million with birth rate of 0.3‰

-          Job generation: 1.7 million, labour export: 85,000

-          Poor household rate: down to 11-12 percent

-          Malnutrition rate among children under five years old: 22 percent

-          Safe water supply: 85 and 75 percent of residents in urban and rural areas, respectively

-          Forest coverage: 40 percent.

To achieve these targets, the Government will continue to improve the investment and business environment, increase the quality, efficiency, competitive capacity and sustainability of the national economy, and stabilise the macro economy. It will better mobilise all resources for infrastructure construction, develop human resources, better solve social issues, and accelerate administrative reform and the fight against corruption and wastefulness.

Mr Dung also underlined the need to maintain socio-political and security stability, defend national sovereignty and increase external affairs to raise Vietnam’s position in the international arena.

“The Government will do its utmost to fulfil its assignments,” said Mr Dung.