The Government needs to be prepared to avoid possible shocks to the economy, along with measures to contain inflation.

Deputy Prime Minister Le Minh Khai at the conference on July 7. Source: VGP

“The priority is to keep the economy running to ensure the people’s livelihood,” Deputy Prime Minister Le Minh Khai stressed the view during a conference discussing Vietnam’s finance-budget performance in the first six months on July 7.

In the past months, the inflationary pressure has gathered pace in Vietnam and posed risks to the economy.

Data from the General Statistics Office (GSO) revealed the consumer price index (CPI) in the first half of 2022 expanded by 2.44% year-on-year, and core inflation by 1.25%.

At the conference, Minister of Finance (MoF) Ho Duc Phoc acknowledged rising prices of key commodities would eventually lead to a high inflation rate, putting a huge burden on businesses’ operations and people’s lives.

“The ministry is committed to ensuring the inflation is kept under control,” Phoc said.

The latest forecast from the World Bank and International Monetary Fund (IMF) coincided with the view that Vietnam remains on track to keep inflation below the 4% target in 2022.

This year, the Vietnamese Government sets the goal for GDP growth at over 6.5%, and inflation below 4%, seen as a key measure to stabilize macroeconomic conditions and key balances of the economy.

Deputy Prime Minister Khai also called for the MoF to continue to explore options to lower taxes and fees to mitigate the inflation impacts on economic activities.

The ministry is expected to continue cutting the environmental protection tax on petrol and diesel products right in the upcoming price review next week, following the approval from the Standing Committee of the National Assembly on the issue on July 6.

Khai urged the MoF to ensure sufficient funds to carry out the socio-economic recovery program worth VND350 trillion (US$15.4 billion) during the 2022-2023 period.

“Improvements of the business environment should continue to be a priority, especially in clearing any legal hurdles to better mobilize resources for sustainable economic development,” Khai said.