|Photo for illustration. Source: vietnam.vn |
In 2011, the country was challenged by numerous external difficulties, which were beyond expectations. Prices of food, crude oil and raw materials on the international markets rocketed; the stock market plummeted; public debt crisis spread to a large number of countries in the globe; global economic growth slowed down and high inflation appeared in almost all countries over the world. The outside problems caused negative impacts on the domestic economy.
Inside, inflation and interest rate soared. Trade gap was wider. Deficits arose in the balance of international payments. Decline foreign reserves put more pressure on the monetary and exchange markets. Gold prices fluctuated unusually. Production encountered numerous difficulties. The economy faced instability.
Dealing with these difficulties, PM Dung on February 24, 2011 released Resolution 11/NQ-CP on key solutions for controlling inflation, stabilizing the macro-economy and ensuring social welfare.
The Resolution stipulated that the current flexible monetary policy needs to be carried out in a close and cautious manner to harmoniously combine with the fiscal policy in a bid to curb inflation, maintain a credit growth at 20%, and realize 15-16% of total means of payment. It also referred to the implementation of a tight fiscal policy and the cut of State budget and overspending.
Thanks to these timely and sound measures, CPI growth rate decreased since May, 2011 and stood around 18.13% for the whole year.
Interest rates were declining too. Exports surged 33%. Trade gap saw the smallest rate over the last five years.
Expanding business activities
The Government deployed numerous solutions, including tax exemption and cut for individuals and enterprises.
Typically, 30% of enterprise or corporate income tax (EIT) was exempted for small and medium-sized enterprises; 30% of EIT was cut for enterprises which use intensive labors in the fields of production, processing and 50% of value added tax was reduced for some personal income.
Besides cutting public investment, the Government instructed relevant agencies to produce essential commodities for production and consumption; assist agro-forestry and fishery production; encourage advantageous and high value added products; speed up key projects and promote PPP models.
Vietnam posted a growth rate of 5.89% in 2011. The growth rate of the agro-forestry-fishery sector expanded 4%; that of the industry and construction sector, 5.53%; services, 6.99%; and industrial production value, 6.8% against 2010.
Outstanding achievements in social welfare
In the context of price hikes, natural disasters and epidemics, the Government focused its attention on ensuring social welfare.
Social resources were mobilized for poverty reduction, job generation, and assistance to natural victims, poor people, low-income earners and social beneficiaries.
Typically, budget spending for social welfare activities increased by 20%, totaling around VND 84 trillion. Over 1.54 million jobs were created. The unemployment rate in urban areas was only 4%. Poverty rate dropped 2%.
The Government also made huge achievements in other areas like education and training, healthcare, culture, sports, information, science-technology, environment protection, administrative reform, anti-corruption, foreign diplomacy, national defense and security, creating a foundation for people to believe in the leadership of the Party, State, Government to steer the country to move forward.