Don't be complacent or satisfied with the results achieved.

President Nguyen Xuan Phuc noted that we must not be satisfied with the results achieved. Photo: VGP/Nhat Bac

During the group discussion session on the socio-economic situation on the morning of May 25, at the National Assembly, the issue of inflation risk and control solutions was mentioned a lot by National Assembly deputies.

Despite recording many initial positive results, some existing risks that Vietnam faces were also discussed by delegates.

Facing many challenges

Speaking at the discussion, President Nguyen Xuan Phuc reminded us not to be complacent or satisfied with the results achieved. Because the long-term impact of the pandemic has consumed almost all of people's savings, business accumulations, and state funds.

The President warned of signs of inflation when Vietnam's economy is highly open, input factors increase, leading to many general difficulties for the economy.

Meanwhile, the stock market, an important capital mobilization channel, has "evaporated" billions of dollars recently. Therefore, better measures and methods are needed to support the stock market to stabilize this channel, help capital flow to businesses, create jobs and promote growth.

Regarding the economic stimulus package, the Party and State have had policies to deal with a number of issues and have seen the difficulties of businesses and workers. However, the President commented that some implementations are still slow; businesses and workers have benefited little. "Therefore, it is necessary to promote more strongly so that these stimulus packages can be put into practice."

"We need to focus on overcoming the situation at all levels so that people can feel more secure in the context of many social changes. We should not be too optimistic but we should not be too subjective...", the President noted.

President Nguyen Xuan Phuc reiterated the goal of the 13th Party Congress that by 2025 our country will escape from the low-middle income group, by 2030 it will be an upper-middle income country, and by 2045 it will become a developed, high-income country. To achieve the goal, we must have continuous high growth, this responsibility is very heavy because with the growth rate (6-7%), by 2045 we will be equal to the size of the current Korean economy. We have spent 2 years (2020-2021) not achieving the growth target, so to achieve the goal of being strong, developed, and having high income, we need strong promotion solutions with more synchronous and drastic policy mechanisms to boost the growth rate.

Institutions, policy mechanisms and human resources are important issues. The President suggested noting: "Human resource training is an extremely big issue that needs to be resolved at every level and every sector."

"Development towards the people to reduce difficulties and hardships for the people is our task. People's difficulties are still the issues we continue to care about so that everyone, every household, every business can have vitality, income, and savings. Therefore, policies and mechanisms must be close, trying to remove difficulties and obstacles. The policies must create trust for the people and businesses. Many socio-economic issues need synchronization in management, operation, and direction so that localities can have new vitality," President Nguyen Xuan Phuc emphasized.

Need to control gasoline prices immediately

Delegate Tran Hoang Ngan (HCMC) warned that with a large economic openness, Vietnam faces many challenges in the current volatile context, especially the Russia-Ukraine conflict causing high oil prices, China's "zero covid" policy leading to difficulties in raw material sources...

Mr. Ngan also mentioned many inflationary periods that our country has faced, forcing us to "take high doses" of tightening fiscal policy and monetary policy to stabilize the macro-economy and ensure social security.

In the current context of continuous increase in gasoline prices, Mr. Tran Hoang Ngan said that the National Assembly and the Government need to have a voice to quickly control gasoline prices.

"We accept the market mechanism but need to have tools to control and restrain the increase in gasoline prices, such as continuing to reduce environmental protection tax on gasoline," Mr. Ngan said and raised the issue of not imposing special consumption tax at the present time when gasoline is an essential commodity.

Mr. Tran Hoang Ngan also suggested that the National Assembly should spend a session discussing this issue, because if gasoline prices are not controlled, it will create a "domino effect" causing prices of other goods to increase.

Regarding the financial market, delegate Tran Hoang Ngan suggested that it needs to be "rectified" to be transparent, public, and have clear legal frameworks to help investors feel secure. Along with that, there needs to be an agency to monitor and handle violations thoroughly to ensure transparency.

Meanwhile, delegate Phan Van Mai (Chairman of the Ho Chi Minh City People's Committee) suggested that credit in real estate should be properly tightened to avoid affecting projects that need to be implemented because when capital flows into that field, it will create jobs and have a great impact on the socio-economic situation.

Clear assessment of the world situation affecting Vietnam

Uneasy about external impacts, Standing Member of the National Assembly's Economic Committee Nguyen Manh Hung suggested a clearer assessment of the world situation and the level of impact on Vietnam.

For example, China is Vietnam's largest trading partner and important market, so their "zero covid" policy and internal difficulties will have a big impact on Vietnam.

Along with the forecast of a global growth slowdown in 2022 given by the International Monetary Fund (IMF), Mr. Hung also warned about price increases and the risk of imported inflation in Vietnam.

He cited the World Bank's forecast that energy and gasoline prices in 2022 could increase by about 50% compared to 2021, and food prices could increase by about 23%.

Noting the situation of rising prices in the world, the Standing Member of the National Assembly's Economic Committee said that Vietnam, with the factor of being an open economy, imported inflation is a very real risk, and needs to be noted to have appropriate countermeasures.

In addition, domestic gasoline prices have also increased to more than VND30,000/liter. Although the Government and the National Assembly have made many efforts to control gasoline prices through the price stabilization fund or adjusting tax policies as well as ensuring supply, it is very difficult to completely control them.

Instead, delegate Hung suggested that the Government pay attention to controlling the prices of other input materials, such as electricity. "EVN committed to not increasing electricity prices in 2022, but this commitment is also very difficult to implement because the input of electricity is coal and gas, which are currently at high prices. Countries such as Singapore and Malaysia have increased electricity prices by 6-9%, and some European countries have also increased electricity prices," said Mr. Hung.

From the above factors, the Standing Member of the National Assembly's Economic Committee recognized that the target of controlling CPI at a maximum of 4% this year is a big challenge.