Workers produce automobile parts at Viet Nam Standley Electricity Co. Ltd - a Japan-Viet Nam joint venture based in Ha Noi. Seventy-two countries and territories have invested in the capital city so far, with 3,600 projects worth US$28 billion. — VNA/VNS Photo Danh Lam
The National Assembly (NA) on Tuesday started a two-and-a-half day discussion about the socio-economic development and budget estimates for 2018.
Burning issues such as public debts, disbursement of public investment and solutions to boost growth were also brought to the table.
NA deputy Hoang Quang Ham of the northern province of Phu Tho, said that GDP growth statistics had a problem - often low in the first quarters of the year, and then posting miraculous growth rates in the remaining quarters. “This is an abnormal and illogical performance,” Ham said, urging the Government to clarify it and come up with a solution to ensure substantial and efficient growth.
Ham expressed concern over the tense budget situation and inefficient public investment, adding that the sum of VND80 trillion (US$3.5 billion) allocated to major national projects failed to be disbursed during the past three years. Or another clear example was that the project of Long Thanh International Airport had not been included in the capital allocation plan for 2018, although its feasibility study report was expected to be passed at this NA meeting.
Ham said that public debt was at 62.2 per cent, nearing the ceiling, while budget collection might fail to fulfill the medium-term plan. Public debt was forecast to reach VND4.2 quadrillion by 2020 and 7-8 per cent of the total budget spending would have to be used for paying interest, estimated to average at VND100 trillion per year. By 2020, the country would have to borrow additional loans worth around VND262 trillion, given the tense debt repayment pressure if no improvements were made.
Still, there was misspending, inefficient investments and stagnant projects. “The fiscal policies must be adjusted towards increasing collections, reducing expenses and prioritising paying debts,” he said.
NA deputy Duong Xuan Hoa of the northern mountainous province of Lang Son, said that it was necessary to have a comprehensive evaluation of the implementation of public investments, as well as clarifying accountability for low disbursements and inefficient investments.
Regarding foreign direct investment (FDI), NA deputy Pham Trong Nhan from the southern province of Binh Duong, said that Viet Nam should not attract FDI at all costs but focus on quality. Nhan said that around 50 per cent of FDI companies reported losses but many kept expanding investments in Viet Nam, citing Oxfam’s statistics that the developing countries, including Viet Nam, failed to collect $170 billion due to transfer pricing. In addition, many FDI projects used outdated technologies and caused severe environment pollution, he said.
Meanwhile, FDI companies were provided with a number of preferential incentives, which domestic firms could not access. “Policies to boost the private economic sector must be enhanced to enable them to become drivers of growth,” Nhan said, highly appreciating the Government’s effort in improving the business climate. “In attracting FDI, there must be strict regulations about technology transfer, local procurement rates and environment protection.”
During the morning session, NA deputies also urged the handling of loss-making projects to be sped up, the quality of equitisation of State-owned enterprises to be enhanced, measures to improve and promote the participation of Viet Nam into a global value chain to be improved and administrative reforms to be hastened.
Disaster prevention
NA deputies also urged the enhancement of the forecasting capacity of natural disasters and their prevention.
Deputy Do Trong Hung of Thanh Hoa Province, said that it was critical to have a comprehensive evaluation of the damage caused by recent natural disasters to the country’s economic growth, especially in the agriculture sector. Hung said that support must be provided to suffering localities.
In the long term, the forecasting capacity must be improved, he said.
NA deputy Ma Thi Thuy from the northern province of Tuyen Quang, said that natural disaster prevention must be integrated into the socio-economic development plan. Thuy stressed that forest protection and plantation must be enhanced together with strict punishments for illegal deforestation.
According to NA deputy Sung A Hong of Dien Bien Province, incentives should be provided to difficult localities to narrow the gap in socio-economic development with other regions, adding that mountainous provinces had poor infrastructure and transport connectivity, making it difficult to attract investments.
Nguyen Thi Kim Be, NA deputy of Kien Giang Province, said that attention should also be paid to developing the transport infrastructure in the Cuu Long (Mekong) River Delta to promote regional linkages and enable it to cope with climate change.
Working hour adjustments
NA deputy Nguyen Van Canh from Binh Dinh Province proposed adjusting the working hours of public sector employees in large cities.
Canh suggested working hours should begin at 8:30 am rather than 7:30 am, and that lunch break be reduced from the current 90 minutes or two hours to one hour. Canh said that this would help reduce pressure on the transportation systems. Still, careful evaluation was needed, he stressed.
The Government’s report about socio-economic development in 2017 projected that all of the 13 indicators would be fulfilled and even exceeded. The Government said that the GDP growth rate target of 6.7 per cent this year would be within reach.
Responding to worries of some NA deputies about the risk of missing the GDP growth target this year, Minister of Planning and Investment Nguyen Chi Dung said that growth in the fourth quarter of this year was underway to reach 7.31 per cent to achieve the target for the full year. Dung stressed that the economic figures were reliable. — VNS