Increasing 1 million tourists is better than consuming 1 million tons of oil

Deputy Prime Minister Vuong Dinh Hue affirmed that mineral exploitation, especially crude oil, is no longer a mainstay for Vietnam's economy.

Deputy Prime Minister Vuong Dinh Hue affirmed that economic growth can no longer rely on mining and capital as before - Photo: Le Kien

Speaking at the National Assembly meeting on October 24, Deputy Prime Minister Vuong Dinh Hue presented a series of analyses to refute doubts about the spectacular economic growth rate in the third quarter of 2017.

"The General Statistics Office is meticulous about every number. Mr. Nguyen Bich Lam (General Director - NV) is very meticulous" - Mr. Hue affirmed.

The end of oil-led growth is near

"In the past, we used to say that if we wanted to grow, we could easily exploit 1-2 million more tons of oil, but now it's not that simple. In the first 9 months, mining has decreased by 8% compared to last year," said the deputy prime minister.

He affirmed that in the past two years we have begun to face the reality that the mining industry has continuously declined and declined very deeply, first crude oil, then coal.

With coal, the average mining depth is -285m below sea level, the high cost of mining makes it difficult. In 2017, crude oil exploitation only reached 13.28 million tons, a decrease of 3 million tons compared to 2016.

"Now, even if we want to exploit more to grow, it is not possible because now oil has to go to far seas, crude oil reserves are decreasing. We also do not have much crude oil and the reserves with commercial potential are low, so there is no growth based on crude oil" - Mr. Hue said.

The Deputy Prime Minister also said that the opinion that Vietnam's growth depends on capital is incorrect. "Credit can be managed to grow at 21%, but it depends on the absorption capacity. The first 9 months of the year only reached 11%, almost the same as last year, and from now until the end of the year, the Government will manage depending on the absorption capacity of the economy," he explained.

"So what is the growth driver based on?" - the Deputy Prime Minister raised the issue and explained: Industry increased, importantly the processing and manufacturing industry increased very strongly, this was the growth driver of the third quarter and the first 9 months of the year.

Tourists and Galaxy Note 8

"Last year, the Galaxy Note 7 incident caused Samsung to lose 1 billion USD, after that they focused on making Note 8, which sold very well in the third quarter of this year, contributing to the electronic components industry increasing by more than 41% in 9 months, of which Samsung increased by 45%. Bac Ninh industry increased by 25.1%, Hai Phong 20.1%, Thai Nguyen 18.1%, Hai Duong 11.2%, Dong Nai 8.3%...", Mr. Hue analyzed.

"This key industrial zone is growing well, Samsung's domestic ratio is currently 57% (previously 20.1%) including participating Vietnamese enterprises and domestic Korean enterprises coming to produce in Vietnam. If the situation continues like this, the manufacturing industry is expected to increase by 13.5%, the highest since 2010."

At the same time, the construction industry increased by 9-9.5% due to investment in urban infrastructure and FDI projects. The whole year is expected to increase by 7.5-8% and contribute 2.5-2.6% to GDP growth. The gap between FDI and exports has narrowed.

Services in 2017 also made a breakthrough, growing evenly in all provinces, in which wholesale and retail increased the most, each month Vietnam welcomes more than 1 million international tourists, it is estimated that the whole year will have 13 million international visitors for sure.

The Deputy Prime Minister also said that the spillover effect from tourism to service provision impacts GDP growth. Tourism and service provision alone contributed 3.2% to the 6.7% GDP growth, higher than construction and completely offset the decline caused by oil and gas.

Agriculture also grew impressively, with an increase of 2.78% in the first 9 months of 2017, 4.3 times higher than in 2016. The government strives for agricultural growth of 3-3.05% for the whole year. The contribution to the overall growth of agriculture is 4 times higher than in the same period in 2016. Agricultural exports this year are likely to reach 30-34 billion USD.

» Deputy Prime Minister Vuong Dinh Hue pressed the button to operate Vissai port, welcoming a 70,000-ton ship

According to Le Kien/tuoitre