NA Standing Committee urges Gov’t to build short-, long-term development scenarios hinh anh 1The meeting of the NA Standing Committee on May 15 (Photo: VNA)

Hanoi (VNA) - The Government should take the initiative in building short- and long-term scenarios for socioeconomic development and review major targets of the economy for 2020 and 2016-2020, which will be the basis for adjusting targets, law makers said at the National Assembly (NA) Standing Committee’s meeting on May 15.

Discussing the Government’s supplementary assessment of socio-economic development and State budget performance in 2019 and the first months in 2020, NA Standing Committee members lauded the Government’s efforts and measures to support people and enterprises affected by the COVID-19 epidemic. 

Presenting the Government’s report, Minister of Planning and Investment Nguyen Chi Dung highlighted that 2019 is the second year the country fulfilled all 12 key targets set by the NA, with a GDP growth rate of more than 7 percent.

Entering 2020, Vietnam’s economy has been seriously affected by the COVID-19 outbreak, with most sectors suffering from growth decreases. Some industries were even almost frozen such as transport, services, trade and tourism.

As such, the Government has drafted two scenarios for the economy, he said, elaborating that in one scenario where Vietnam has basically contained the epidemic since the latter half of April and the country’s important trade and investment partners are able to control the epidemic in the third quarter, the GDP growth rate would be around 4.4-5.2 percent for this year.

In the second scenario, where Vietnam has basically contained the epidemic since the latter half of April and the country’s important trade and investment partners are able to control the epidemic in the fourth quarter, the GDP growth would be projected at 3.6-4.4 percent.

The minister said considering the scale and level of impacts of the COVID-19 pandemic, the Government is of the view that it is necessary to revise the targets for 2020.

The Government’s report suggested that the GDP growth target should be revised down to 4.5 percent from the initially 6.8 percent. If the world situation develops in a favourable direction with the pandemic put under control and the international market recovering, the target could be raised to 5.4 percent to ensure meeting the goal of an average annual growth of 6.5 percent in the 2016-2020 period.

Export growth should be revised down to 4 percent from the previous 7 percent, and CPI at 4 percent instead of under 4 percent, while State budget collections would be reduced by 163 trillion VND (nearly 7 billion USD).

A report of the NA’s Economic Committee confirmed the Government’s assessment, saying that the Government should research and submit to the NA adjustments to targets within the legislative’s jurisdiction, while working out specific and flexible solutions for the best possible performance.

NA Chairwoman Nguyen Thi Kim Ngan agreed that the initially set GDP growth target cannot be reached and State budget collection is certain to reduce. However, she said the adjustment of targets requires time for thoroughly evaluation and permission while only several days remain before the opening of the NA’s 9th session.

Vice Chairman of the NA Phung Quoc Hien asked the Government to continue review forecast for 2020 and build a third scenario for the possibility that the pandemic could prolong into 2021.  

The NA Standing Committee agreed that there is not sufficient legal ground to submit the adjustment of targets to the NA at the upcoming 9th session. If necessary, the adjustment will be presented to the NA’s 10th session.

Also during the meeting, the Government reported that State budget collection in the first four months of the year reached 32.5 percent of estimates, down 5.9 percent year on year, with most types of revenue falling compared to the same period last year.

Head of the NA’s Finance-Budget Committee Nguyen Duc Hai said tax reduction measures to support people and citizens result in remarkable reduction in budget collection in the past four months.

The committee also noted the slow disbursement of development capital by ministries, central agencies and localities. It urged the Government to work harder to remove difficulties for production-business activities, speed up public capital disbursement while tightening order and discipline in public capital management and use.

According to the committee, it is not feasible to achieve the growth target set in the NA resolution, while the budget balance will be affected by reduced revenues and rising spending needs to cope with the pandemic, ensure social security and support enterprises./.