Many businesses have to transfer and sell assets at low prices, and need to continue reducing interest rates.

At the opening session of the 5th session of the 15th National Assembly on the morning of May 22, reporting on the additional assessment of the results of the implementation of the socio-economic development plan and the State budget in 2022; the implementation of the socio-economic development plan and the State budget in the first months of 2023, Mr. Vu Hong Thanh commented that the socio-economic situation in the first 4 months of 2023 continued to reveal difficulties and challenges from the fourth quarter of 2022, causing great pressure on macroeconomic management and the ability to complete the growth target for the whole year of 2023.

The average lending interest rate remains high, at around 9.3% per year, making it difficult for businesses to access capital.

Along with that, the issuance of stocks and corporate bonds also encountered difficulties. In the first quarter, the total value of capital mobilized through the issuance of stocks and corporate bonds reached VND1.7 trillion and VND28.96 trillion, respectively, down 92% and 87.9% compared to the same period last year.

“The market and real estate businesses continue to face many difficulties in liquidity and cash flow, many businesses are slow to pay principal and interest on bonds. Especially, in the context of great pressure on maturity and waiting for corporate bonds in 2023, especially in the third quarter, it is expected that about 104,000 billion VND of bonds will mature,”Mr. Thanh emphasized.

According to Mr. Thanh, from now until the end of 2023, it is forecasted that there will be more difficulties and challenges than opportunities and advantages, so the inspection agency has raised a number of issues that need attention.

Specifically, focus on consolidating and strengthening the macroeconomic foundation, controlling inflation, improving the internal capacity and autonomy of the economy on the basis of health, maintaining stable and safe development of the system of credit institutions, the monetary market, the real estate market, the stock market, and corporate bonds. Operate fiscal policy with focus and key points, sharing the role of supporting economic growth recovery with monetary policy.

Study the option of increasing the family deduction for personal income tax, reducing value added tax without reducing budget revenue and being flexible in adjusting environmental protection tax on petroleum products.

Conduct monetary policy proactively, flexibly, and effectively, closely coordinating with fiscal policy and other macroeconomic policies in reasonable doses to promote growth, but taking into account increasing inflationary pressure.

"It is necessary to proactively consider continuing to lower operating interest rates to support growth. Synchronously implement solutions to remove difficulties, while strengthening management and supervision of the currency, stock, corporate bond, and real estate markets; strictly control the granting of credit for capital use, especially for enterprises, corporations, and backyard projects; protect the rights of investors according to the provisions of law,"Mr. Thanh emphasized.

The annual growth target of 6.5% is very difficult.

Mr. Thanh also acknowledged that GDP growth in the first quarter of 2023 reached 3.32%, a very low level in the context of the economy opening up after controlling the COVID-19 pandemic and on the low base of the same period last year. Therefore, completing the annual growth target (6.5%) is very difficult.

Mr. Vu Hong Thanh - Chairman of the Economic Committee reported at the opening session on the morning of May 22. Photo: Quochoi.vn

“The total number of newly established and re-opened enterprises decreased by 2% compared to the same period last year, while the number of enterprises withdrawing from the market increased by 25%, and this trend may become more complicated in the coming time. Many enterprises are facing great pressure to repay debts, so they have to transfer their enterprises and sell shares at very low prices, in many cases to foreign partners. The number of enterprises lacking orders is common,”Mr. Thanh emphasized.

The next issue noted by the National Assembly agency is that the state budget revenue for the first four months is estimated to have decreased by 6.9% compared to the same period last year, many localities have set low budget estimates but allocated higher budgets than the central budget (43/63 localities).

The domestic economic sector continued to have a large trade deficit (6.62 billion USD). Core inflation increased by 4.9%, higher than the average consumer price index, showing that the economy's ability to absorb capital was weak, and the impact of monetary and fiscal policies had significantly reduced their effectiveness, Mr. Thanh said.

Pham Duy