During a speech at a July 7 online conference to review the State budget, the country’s financial performance in the first half of the year, and to deploy financial tasks for the remainder of the year, Finance Minister Dinh Tien Dung said the impact of the novel coronavirus (COVID-19) epidemic had led to a sharp fall in global crude oil prices.
This has occurred alongside the implementation of preferential policies regarding taxes, fees, and other revenues, therefore leading to a downturn in the State budget revenue during the opening months of the year.
Most notably, revenue from three leading economic sectors stood at low levels. Specifically, revenue from state-owned enterprises only reached 37.1% of the their anticipated value, a fall of 21.5%, whilst revenue from FDI enterprises stood at 41.9% of the estimate, a drop of 6.3%, with revenue from the non-state economic sector reaching only 37.1% of the estimate, down 15%.
These figures indicate the current state of the national economy, with the performances of local businesses facing plenty of difficulties.
With regard to the management of State budget spending, Minister Dung said that the total state budget expenditure as of the end of June was approximately VND729,400 billion, equal to 41.8% of the anticipated figure.
In general, the management of State budget spending was carried out in an effective manner and in line with proper policies.
According to the Finance Minister, an economic growth rate of 1.81% during the first half of this year, coupled with falling import-export turnover, led to achieving the growth target set out by the Government and reported to the National Assembly being extremely difficult to meet, in turn affecting the State budget revenue and expenditure balance.
In order to reduce the negative impact of the COVID-19 pandemic and to spread out future challenges among enterprises and citizens, the Ministry of Finance urged both the Government and the National Assembly to request central and local ministries move to put State budget spending under stricter control.
This should be done by cutting at least 70% of conference and domestic travel expenses, in addition to saving a further 10% from other regular expenditures such as unnecessary procurement expenses.
In addition, no adjustments should be made to the base salary for cadres, civil servants, officials, armed forces, and pensions from July 1.
The financial sector has devised 10 important tasks to be carried out during the remaining months of the year with a particular focus being placed on improving institutions, boosting administrative reform, removing difficulties for production and business, and increasing investment attraction for economic development.