Vietnam’s method to revise the GDP is transparent and follows international practices, according to Prime Minister Nguyen Xuan Phuc.
|Prime Minister Nguyen Xuan Phuc at National Assembly's hearing. Source: VGP.|
The revision would result in an enlargement of 25.5% of Vietnam’s economy, taking the GDP from US$267 billion currently to US$310 billion.
“The revision would only be effective after 2020, not at the moment. Therefore, it is not the fondness for achievement that the government revised the GDP,” said Phuc at a hearing before the National Assembly on November 8.
For the time being, the government still uses data before recalculation, Phuc added.
According to Phuc, GDP revision is a common international practice when a country reassesses its GDP after a certain period of time.
In order to ensure transparency and publicity, Vietnam invited the International Monetary Fund (IMF) and representatives of the United Nations to take part in the recalculation process, Phuc added.
Additionally, Vietnam had not included the shadow economy into the GDP calculation, while in other countries, every purchase of trivial things comes with a receipt, stated Phuc.
“In the calculation process, Vietnam missed a lot of things and had a big loss from inefficient tax collection,” he stressed.
Late in August, Head of the General Statistics Office (GSO) Nguyen Bich Lam announced the GDP revision that resulted in an enlargement of 25.4% annually of Vietnam’s economy in the 2010 – 2017 period compared to the previous data.
Lam added revising GDP is a common practice globally, and countries such as the US, Canada, Germany, Russia, Italy, Indonesia, among others, have made similar moves since 2010.
Lam attributed new GDP data to an inclusion of 76,000 enterprises into the revision.
Finance expert Pham Dinh Cuong said GDP revision only serves the purpose of comparison with other countries, instead of having a substantial impact on the economy itself.
Meanwhile, economist Vo Tri Thanh said GDP revision may impact the economy in the long term by leading to changes in a number of economic targets.
“The government must revise its national financial strategy and other economic plans on the basis of new GDP growth rate,” said Thanh.