The Ministry of Industry and Trade (MoIT) is currently appraising the Electricity of Vietnam (EVN)’s proposal to adjust the price of power and will submit a report to the Prime Minister within March, said Minister-Chairman of the Government Office Nguyen Van Nen.

Nen said at the monthly Government press conference on March 2 that the adjustments, with rises of between 7-10 percent, are within the retail price frame for electricity and falls within the MoIT’s authority to decide.

MoIT Deputy Minister Do Thang Hai explained that the increase is necessary to match real costs in line with the market mechanism.

He clarified that the falling price of oil has little effect on electricity price as oil-fuelled plants produce only 0.55 percent of power generation. Meanwhile, a 22 percent increase was seen in the price of coal from the last price adjustment in August 1, 2013, he said, noting that coal-fuelled plants generate 32.37 percent of the electricity output. He added that the price of gas has also been hiked several times.

Responding to concerns of deflation after the consumer price index (CPI) continued to decrease, even during the Lunar New Year festival (Tet) in February, Nen attributed the situation to decreased fuel prices affecting transportation prices.

Domestic production still rose last month with continued growth in purchasing power, he noted, adding that total retail and service revenue in the first two months of this year rose by 11.4 percent from 6.2 percent in the same period last year.

According to the Ministry of Planning and Investment, price stability was ensured thanks to efforts of the government in fixing market prices before and after the Tet festival.

The industrial production index increased 12 percent in the first two months of the year on a yearly basis. Power production rose 13.3 percent, processing and manufacturing 12.9 percent, and mining 9 percent.

Total exports in January and February combined reached over 23 billion USD, a surge of 8.6 percent annually, while imports hit 23.07 billion USD, up 16.3 percent.

Foreign direct investment disbursement hit 1.2 billion USD, a rise of 7.1 percent compared to the same period last year, mostly in processing and manufacturing sectors. As many as 148 new projects were licensed and additional capital was injected into 58 ongoing projects.

Nen also revealed that the Government will continue focusing on stabilising the macro-economy as well as seeking measures to remove difficulties for business while improving the investment environment and enhancing national competitiveness.-VNA