Prime Minister requests to strive for GDP growth of 6%

This view was stated by Prime Minister Pham Minh Chinh when concluding the regular Government meeting on September 30.

Reporting at the meeting, Minister of Planning and Investment Nguyen Chi Dung said that this year's highest economic growth was only 6%, lower than the target assigned by the National Assembly (6.5%), due to internal difficulties and the impact of the world economy.

The forecast was made by the planning agency in the context of low GDP growth in the first 9 months, reaching only 4.24%. This level is about half of the same period in 2022. The growth rate is not as expected, inflation is under a lot of pressure. In addition, growth drivers are facing difficulties, such as slow recovery of industry, the added value in the first 9 months is only about 1.65%.

Faced with this forecast, Prime Minister Pham Minh Chinh requested to choose a scenario of GDP growth of about 6% for the whole year to "strive to achieve the highest possible results for 2023, creating a premise for 2024". According to calculations by the Ministry of Planning and Investment, for GDP to reach 6% this year, the economy in the fourth quarter must grow by 10.6%, which is nearly double that of the third quarter (5.33%).

Opinions at the general meeting stated that the situation will still face many difficulties and challenges. However, Vietnam has certain advantages such as a relatively good macro foundation and economic recovery trend, favorable international relations, and increasingly consolidated and enhanced market and investor confidence.

Prime Minister Pham Minh Chinh reiterated the view that in the current context, priority should be given to promoting growth, specifically the processing and manufacturing industry. The economy continues to restructure in line with growth model innovation and promoting emerging industries, green economy, and circular economy.

The government leader said that the three growth drivers that support the economy (investment, consumption and export) need to be focused on promoting them. Regarding investment, he requested to concentrate capital, speed up the progress of key infrastructure projects and speed up the disbursement of public investment.

"This must be identified as an important driving force for short-term growth, contributing to creating a synchronous and modern infrastructure system to increase economic capacity and attract sustainable investment," said the Prime Minister.

In addition to consolidating traditional markets, export enterprises need to target new markets such as the Middle East, Africa, and Latin America; improve product and service quality to meet new conditions and standards.

In order for consumer motivation to contribute more to the economy, according to the Prime Minister, more solutions are needed to stimulate the domestic market of 100 million people; ensure balance in supply and demand of goods, especially essential goods during holidays and the end of the year.

The solution to "stimulate" domestic consumption demand was also mentioned by the Minister of Planning and Investment, which is to propose continuing to implement tax and fee reduction policies in 2024. Mr. Dung also proposed extending the value-added tax (VAT) reduction period until mid-2024, instead of ending at the end of this year due to the still difficult situation.

VAT has been reduced by 2% since July 1 and will last until the end of this year, according to the National Assembly's Resolution. Unlike other taxes, VAT has the important characteristic that the tax burden is shared between businesses and consumers, so when reduced, both groups will benefit.

Therefore, if this tax reduction period is extended, it will help people save money on spending and living expenses, and have a psychological impact, helping to stimulate demand and increase consumption.

In addition to promoting the three growth drivers, Prime Minister Pham Minh Chinh noted that ministries, sectors and localities should take advantage of opportunities to attract investment capital into emerging fields such as semiconductor chip manufacturing, artificial intelligence, clean energy and green growth. "Do not miss the opportunity to attract investment from upgrading relations and trade and investment agreements with partners," he noted.

In this aspect, Mr. Le Anh Duong, Chairman of the People's Committee of Bac Giang province, informed that in mid-September, the first semiconductor factory in the North was put into operation.

Mr. Duong added that the production capacity of many factories in local industrial parks has been expanded. In the first 9 months, Bac Giang's GDP grew by over 12%, import-export turnover reached over 32 billion USD, FDI capital attraction was approximately 2 billion USD; public investment disbursement reached about 70%. The Chairman of Bac Giang is confident that this year will basically complete the proposed socio-economic targets.