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Monday, November 28, 2022

Relief package worth VND844 trillion proposed for economic recovery

The Saigon Times

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HCMC – A research team comprising permanent members of the National Assembly Economic Committee and experts has proposed a relief package totaling VND844 trillion for the country’s economic recovery and development in the 2022-2023 period.

Regarding fiscal and monetary policy recommendations for socioeconomic recovery and development at the Vietnam Economic Forum 2021 on December 5, Dr Can Van Luc, a representative of the research team, said the relief package would include VND678.4 trillion for fiscal policy, or 8.34% of the country’s GDP; VND65 trillion for monetary policy, VND12.8 trillion for social welfare policy and some VND37.65 trillion for others.

The policy recommendations include reductions in value added tax, social insurance premiums, the environmental protection fee for 2022 and the registration fee for locally assembled or manufactured autos and lending rates, according to newspaper reports.

Luc also proposed offering two million migrant workers in the four key economic zones with VND1 million per month each for a period of three months to help them pay their rent.

Moreover, the electricity and telecom fee in 2022 should be cut by 10%, with a total value of some VND26.65 trillion. Further, the State Capital and Investment Corporation should be asked to contribute VND50 billion.

The relief package could be sourced from the cost reduction, the equitization of State-owned enterprises, the use of deposits and social insurance to buy Government bonds, non-State budget funds and foreign reserves.

To implement the relief package, the country must accept an annual increase of at least 1% in the State budget deficit in 2022-2023.

Luc said Vietnam’s economy had been heavily impacted by Covid-19.

Vietnam’s gross domestic product in the third quarter of this year fell 6.17% and the figure for the whole year was forecast to increase a mere 2%. In addition, the jobless rate last quarter was 3.98%.

Therefore, the new fiscal and monetary policies should be designed in a way that supports economic recovery and development.

Luc added fiscal policy could be made more favorable as the State budget revenue this year may reach the target, the State budget deficit and public debts have been brought under control.

In addition, the banking system has been performing well despite the pandemic.

Luc said financial and monetary policies for economic recovery and development should help boost demand and supply. Relief packages should be implemented quickly and effectively, he noted.

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