The index of industrial production (IIP) rises 3.9% in July compared to the previous month and 3.7% year on year (Photo: VietnamPlus) Hanoi (VNA) – The Government’s financial and monetary policy packages have gradually supported enterprises to stabilise production, particularly the 2% VAT Reduction which has received a warm response from the business community.
Phi Thi Huong Nga, Director of the Department of Industrial and Construction Statistics of the General Statistics Office under the Ministry of Planning and Investment, said enterprise manufacturing showed positive signs in the first seven months of this year.
Accordingly, the index of industrial production (IIP) increased in three consecutive months, from May to July, with the highest index recorded in July at 3.9% compared to the previous month. This is a rise of 3.7% compared to the same period in 2022.
Nga highlighted some key industrial manufacturing sectors which recorded a growth rate of 10% year on year such as manufacturing products from prefabricated metal, metal, chemical production, tobacco, drugs-chemicals-pharmaceuticals, food processing, textiles, rubber-plastic products, among others.
Nhập mô tả cho ảnhThe gloomy outlook of the world’s economy has affected Vietnam’s industrial manufacturing results in the first months of 2023 (Photo: VietnamPlus)
However, in the first seven months of this year, the IIP dropped 0.7% year on year as the gloomy outlook of the world’s economy has affected Vietnam’s industrial manufacturing results in the beginning months of this year. As a result, industrial production in the first four months was down 2.4% year on year.
The Government has issued monetary and financial policies to support enterprises. These include the exemption and reduction of taxes, fees and charges (2% value-added tax reduction; 50% reduction of registration fee for locally-assembled-made automobiles; 50% reduction of environmental protection tax for jet fuels, 30% reduction of land rent, water surface rent and extension of time for paying taxes).
Besides, the State Bank of Vietnam (SBV) lowered regulatory interests for four consecutive times since the beginning of this year ranging from 0.5% -1%. Commercial banks have restructured debts and rescheduled debt payment, rebought corporate bonds and implemented the 100 trillion VND social housing credit package.
According to Nga, the Government’s financial and monetary policies have gradually supported enterprises stabilise their production. The VAT reduction package from 10% to 8% has received a warm response from the business community.
Some key manufacturing sectors of Vietnam largely depend on orders from the US and the EU. (Photo: VietnamPlus)
Hoang Quang Phong, Deputy Chairman of the Vietnam Chamber of Commerce and Industry (VCCI), said that difficulties caused by external factors, have hindered economic recovery in many countries, including Vietnam. These factors include consequences of the COVID-19 pandemic, Russia-Ukraine conflict, and inflationary pressures.
In addition, the shift of value chains and partners with higher requirements towards sustainable production and consumption, green economy, digital economy, Industry 4.0 has increased strongly.
These things mean the domestic business sector must innovate to catch up with trends and opportunities to participate in the global value chain.
Phong proposed the Government and ministries, sectors, and localities implement key solutions to support and develop businesses.
Besides, the legal framework on business investment and innovation-based business models needs to be improved. Specifically, all levels need to continue to have solutions to reduce costs for businesses, and enhance access to resources from supporting packages of the State.
In addition, Phong asked the business community to assess and identify challenges and opportunities, so as to have appropriate solutions to help businesses develop sustainably./.
