In 2024, domestic consumers and businesses will have to face crucial decisions regarding spending and investment. (Photo: VietnamPlus) Hanoi (VNA) - Increasing public investments, easing monetary policies, stabilising foreign exchange rates, and ensuring sufficient supplies are among the solutions recommended by experts to control the rise in the Consumer Price Index (CPI) this year.
Under the National Assembly’s Resolution No. 103/2023/QH15, the national gross domestic product (GDP) is expected to expand from 6-6.5% and the CPI growth kept at 4-4.5% in the year.
Associate Professor, PhD. Vu Duy Nguyen, Director of the Institute of Economics and Finance, forecast that the average CPI in the first half of this year will rise 3.2-3.5% year-on-year.
According to the expert, the world political-economic situation will facilitate Vietnam’s efforts to maintain its average CPI.
He added that inflation in neighbouring China is forecast to remain low at 0.5% this year, while the trade balance between the two countries reached 173.3 billion USD in 2023, with China being the main supplier of materials for Vietnam's manufacturing activities, hence the risk of inflation-driven imports is low.
Moreover, inflation in big economies, which are Vietnam’s major trade partners and export markets such as the US and the EU, is being tamed, leading to the low risk.
Domestically, Nguyen noted several advantages brought about by macroeconomic policies maintained in the direction of fiscal and monetary easing based on the "pillars" of foreign exchange reserves, budget revenue, trade surplus, and increased FDI attraction and disbursement.
Natural disasters and epidemics would affect food and foodstuff prices in some localities, causing the CPI to rise. (Photo: VietnamPlus) Associate Professor, Dr. Phan The Cong, head of the Economics Department at the Thuongmai University, pointed to a number of factors that would cause inflation pressure and price fluctuations in Vietnam such as global high material prices, natural disasters and epidemics, among others.
In addition, the prices of strategic goods managed by the State such as health care and education services may increase after many years of suppression, plus the impacts of wage increases and rising prices of consumer goods according to seasonal factors.
The Government's support programmes also increase aggregate demand, causing inflationary pressure in the economy, he said, adding that these things cause consumers and domestic businesses to face important decisions about spending and investment.
Given this, Nguyen raised some recommendations regarding policy management to maintain CPI growth at 4-4.5% this year, including increasing public investments in line with the 2024 state budget estimate approved by the legislature, maintaining monetary policy easing, and stabilising the foreign exchange market and currency value.
He also suggested stabilising the prices of state-managed commodities; ensuring adequate supplies of goods, especially food, foodstuff, and other essential goods; and intensifying the communications work to make price information and the management work transparent.
All-level management agencies need to have policies to ensure smooth supply, circulation, and distribution of goods and services. (Photo: VietnamPlus) In this regard, Cong proposed the government, ministries, and agencies keep a close watch on price and inflation developments in the world to give timely warnings of risks affecting prices and inflation at home.
Notably, reducing inflation needs policies, fiscal and monetary solutions, and wage adjustments, he said, stressing that enterprises should fully prepare conditions to boost production and business, ensure the supplies of goods and services, and invest in technology, human resources, and other areas to raise productivity and competitiveness, he said./.
