Viet Nam's top 10 economic events in 2015

Friday, Jan 01, 2016 09:00

The Vietnamese economy witnessed important events during 2015. Vietnam News Agency highlights the following ten:

1. GDP growth reaches record high

Viet Nam's gross domestic product (GDP) grew by 6.68 per cent throughout 2015, the highest level recorded over the past eight years and higher than the 6.2 per cent target that the National Assembly adopted for 2015. Social security was generally assured, still the macro-economic situation remained unstable, with productivity, quality, efficiency and competitiveness of the economy proving low; national budget balances still faced tension, while public debts increased and the progress of State-owned enterprises' equitisation was not up to expectations.

2. Economic integration

Viet Nam concluded negotiations for four free trade agreements (FTAs), including those with the Eurasian Economic Union, the European Union, South Korea and the Trans-Pacific Partnership, during 2015. This brought the total number FTAs that Viet Nam takes part in to 14. The ASEAN Economic Community was established on December 31, likely to create more opportunities for the country to integrate into regional and global economies.

3. State budget revenue higher than expected

In 2015, global oil prices plummeted and many lines of tariffs declined sharply following integration commitments. However, with the intensification of tax collection measures, Viet Nam's total State budget revenues were higher than expected. As of December 28, 2015, State budget revenues were approximately VND957 trillion (US$42.53 billion), five per cent exceeding the official figure anticipated for the year. While the revenues from crude oil trades and import-export activities reached 73.1 per cent and 98.2 per cent, respectively, of the targeted values, the revenue from domestic sources was 10.9 per cent higher than the planned quota.

4. Central bank acquires commercial banks at zero dong

For the first time in domestic banking history, the State Bank of Viet Nam took over three banks, including Viet Nam Construction Bank, Global Petro Bank and Ocean Bank, through compulsory acquisitions at a price of zero dong per share. This was a drastic step in line with the Government's roadmap to restructure the domestic credit institution system.

5. State capital divestments requested at 10 major businesses

In 2015, Prime Minister Nguyen Tan Dung asked the State Capital Investment Corporation to work out schedules for withdrawing the entire State capital from 10 major enterprises. They included Bao Minh Insurance Corporation, Viet Nam National Reinsurance Corporation and Ha Giang Mineral Mechanics JSC, besides Tien Phong Plastic JSC, Binh Minh Plastic JSC and Viet Nam Infrastructure and Real Estate JSC. Viet Nam Dairy Products JSC, information technology group FPT, Sa Giang Import Export Corporation and FPT Telecom. The Prime Minister's request was part of national efforts to diversify sources of investment capital in these businesses and help them achieve more efficient management methods.

6. Breakthroughs seen in traffic infrastructure

Many important traffic works were put into operation in 2015. They included the expanded Thanh Hoa-Can Tho parts of National Highway 1, the Ha Noi-Hai Phong, Noi Bai-Lao Cai and HCM City-Long Thanh-Dau Giay expressways, and the Ho Chi Minh Highway through the Central Highlands. The National Assembly also approved a plan to develop a new aviation terminal Long Thanh, which will be built in southern Dong Nai Province with an investment capital of about VND336.63 trillion ($14.96 billion).

7. Eight serious corruption cases put on trial

The Central Steering Committee for Anti-Corruption put eight serious economic corruption cases on trial during the past year. The cases included: Phuong Nam Foodstuff Corporation in the Mekong Delta province of Soc Trang; Agribank's branch No 7 in HCM City; and Railway Project Management Unit under the Viet Nam Railway. The others were: Dong Phuong Knitting Company under the Viet Nam National Textile and Garment Group and Agribank's branch No 6 in HCM City; Finance Leasing Company No 2; and marine technology company Hai Phong and marine transort firm Dai Phat. Lifepro Viet Nam and Agribank's South Ha Noi branch; and Dong Thap Petroleum Trading Co Ltd also faced judgement.

8. Banned breeding substances rife

Use of prohibited substances in animal breeding increased alarmingly in 2015, although Viet Nam had banned the use of beta-agonist, including Clenbuterol, Salbutamol and Ractopamine, in husbandry for more than a decade. Cracking down on the violators is agricultural authorities top priority.

9. Foreign investment rules slackened

On June 26, 2015, the Government issued Decree No 60/2015/ND-CP, giving no stake limits for foreign investors who invest in public enterprises which deal in unconditional fields of business. The decree also enabled unlimited investments by foreign investors in government and corporate bonds. The development was considered a breakthrough for the country in attracting foreign capital into the Vietnamese stock market. However, by the end of 2015, Saigon Securities Inc was the only brokerage approved by the Government to give foreign investors "full-room" investments following the document.

10. Agriculture-forestry-aquaculture markets slow

In the face of harsh weather and market obstacles, export values of agriculture-forestry-aquaculture products totalled some $30.13 billion in 2015, down 1.4 per cent over 2014. Many major exports witnessed declines, such as coffee falling by 28.1 per cent, aquatic products dropping by 16.5 per cent, and rice, tea and rubber decreased by 2.9 per cent to 14.4 per cent. Onions and watermelons were also redundant, with the public having to launch purchase movements to support farmers.— VNS

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