(VEN) - On the threshold of the New Year, Prime Minister Nguyen Tan Dung issued a major statement stating the vital tasks and solutions that the Government will fulfill to increase macro economic stability and achieve economic growth that is higher than that of 2009. The following are quotes from the statement.
The year 2010 is an vital year for Vietnam, as it is the last year in which the country's 2006-2010 socioeconomic development plan will be finished in accordance with the resolution of the Communist Party's 10th National Congress, a year in which sessions of Party committees at different levels are to be held to prepare for the 11th National Congress of the Communist Party, a year in which Hanoi celebrates its 1,000th anniversary, and a year in which many other anniversaries and major international events are to take place in Vietnam. Fulfillment of socioeconomic development plans of 2010 and the period from 2006-2010 as a whole, are important in providing the preconditions for realizing the 2011-2020 socioeconomic development plan, and are not only the political task of every Party member and officer but also the legitimate demand of citizens nationwide.
At its sixth session, the National Assembly defined the general tasks for 2010. They include 1) To reach an economic growth that is higher than that of 2009, 2) to increase macroeconomic stability, 3) to improve the sustainability in growth, 4) to prevent the return of increasingly high inflation, 5) to increase social welfare, 6) to take the initiative in international integration and improve international cooperation, 7) to assure political stability, national defense, and social security and order, and 8) to achieve as many socioeconomic targets as possible in the period from 2006-2010.
Strengthening macroeconomic stability, as a basis to achieve economic growth higher than in 2009 in terms of both quality and quantity, and preventing higher inflation from increasing are the main tasks for socioeconomic development management in 2010. While efforts are made to reach an economic growth higher than in 2009, more conditions and resources will be created to increase macroeconomic stability and assure better social welfare.
Following this line, while solutions are to be consistently implemented to reach general and concrete targets of 2010, it is necessary to efficiently implement the following five groups of tasks and solutions.
 The first is to strengthen macroeconomic stability and assure major balances in the economy.Macroeconomic stability is integral to develop trade and production and reach a stable society and sustainable development.
Observing the rules of a market-oriented economy, assuring major balances in the economy, effectively combining financial and monetary policies and efficiently integrating monetary policy measures, properly handling the relation between credit interest rates and exchange rates and the international balance of payments and especially balance of trade, effectively managing the foreign currency market and national debts, assuring capital and liquidity of the economy, increasing budget revenue and economical spending, investment and growth promotion, controlling inflation and assuring a safe financial and banking system are basic principles of macroeconomic management.
It is necessary to better bring into play the State's role in management. This is vital for a country in transition and where market rules have not been formed consistently, imbalances in the economy can occur and the competitive environment still has shortcomings, such as Vietnam. The State's role and intervention in the market is aimed at ensuring that the market-oriented economy operates in the correct manner while macroeconomic stability is assured and market relations are not deformed. It is very important to make the use of regulatory measures highly efficient and cost effective and be in a position to accurately forecast market reactions. If markets or sectors are prone to creating major imbalances, or affect macroeconomic stability, they must be controlled.
The second is to focus on investment promotion, trade and production development and restructuring the economy
Macroeconomic stability is important but it is not only a matter of policy. A policy does not decide everything but instead creates an environment and conditions for developing trade and production, mobilizing and allocating resources, regulating development possibilities and orientating operations of the economy. Macroeconomic management capability depends on economic potential. A weak economic potential leads to a limited macroeconomic management capability. Hence, solving difficulties in pinpointing solutions, mobilization of resources for investment, economic structure transformation promotion, trade and production expansion, and export stimulation must be key in a sustainable development approach.
Agriculture (including forestry and fisheries) plays a very important role in poverty reduction, social stability, food security and export development. The market of farm produce especially essential farm produce is less affected by the global financial crisis and economic downturn, while farm produce are the goods that have the biggest impact on product prices in Vietnam. Agricultural production improvement for creating more products for domestic consumption and export, increasing the community's purchasing power and bettering farmer's income is a necessity. Climate change, storms, floods, droughts, pests and diseases always threaten agricultural production so they need to be controlled to minimize losses in all agricultural production areas.
Industrial production development is the core of economic structure transformation, modernization and industrialization. Increasing production value and the industry sector's added value are important to make this sector achieve higher growth than in 2009. Decreases in production and sales, which are the consequence of the global financial crisis and economic recession, show the competitiveness of, and demand for specific products in specific markets, based on which businesses and localities need to restructure production for the better in 2010. The major orientation is to focus on developing products that have a high added value, a big market share and fast growth, along with developing and expanding markets and keeping an eye on newly emerging changes on the markets in order to develop appropriate reactions.
 In 2010, the State continues increasing investment to stimulate growth while at the same time encouraging every economic sector to invest in infrastructure, trade and production development. Increases in investment will not only create a new production capability and promote construction growth but also create a market for goods and services and more jobs so they will have a positive impact on the entire economy. It is urgently required to speed up project implementation and construction to put projects into use and create concrete products as soon as possible, through which to improve investment efficiency. Therefore, the allocation of capital and mobilization of resources for completing projects in 2010 must be prompt and serious.It is important to be resolute in stopping diffuse investments that could lead to construction durations that are longer than expected, higher in costs and late to transfer.
Vietnam's economy is entering a period in which economic relations vary and are more complicated and specialization and cooperation are developing, and therefore the demand for different kinds of services increases. Over the past several years, the service sector experienced a growth that is higher than the gross domestic product (GDP) growth. In 2009, this sector experienced a growth that was higher than industrial production growth. This sector makes an increasing contribution to the country's economic development. This actual situation poses new development demands and opportunities for different kinds of service especially financial, information, consulting, tourism, trade, transport and logistical services.
Export promotion, trade deficit reduction and improvement in the trade balance are all important for macroeconomic stabilization and growth promotion. Although difficulties are still ahead because the world economy recovers slowly, the general situation of Vietnam in 2010 is expected to be more advantageous than in 2009. It is necessary to better exploit traditional markets and markets where a free trade agreement has been signed. It is also necessary to develop new markets especially potential markets in Eastern Europe, West Asia, the Middle East, Africa and Latin America.
The Vietnam-Japan Comprehensive Economic Partnership Agreement, which took effect on October 1, 2009, is expected to have a stronger effect in 2010, while the ASEAN- (Association of Southeast Asian Nations) China Free Trade Agreement, under which 90 percent of import tax lines of China and six ASEAN countries are reduced to zero (0) percent starting in 2010, is expected to create favorable conditions for Vietnamese goods to enter China and the six ASEAN countries. Businesses need to take new opportunities to increase their export revenue.
Vietnam is a big market that experiences a fast, stable growth. For many years, retail sales and service revenue grew 10 percent annually, and it increased 12 percent in 2009 alone (this 12-percent growth does not include price increases). The distribution service sector now makes a 14 percent contribution to the country's GDP and uses more than five million employees. It ranks first among service industries in terms of job creation. Multi-national groups have been active in exploiting the Vietnamese market.
In 2009, while the domestic market was considered basic, foreign markets are considered important and the movement encouraging 'Vietnamese buy and use Vietnamese products' was promoted, resulting in the domestic market seeing positive changes. Businesses paid a bigger attention to increasing sales in the domestic market, while more Vietnamese bought and used Vietnamese goods.
The first thing that businesses, which want to dominate the domestic market, should do is to improve their competitiveness and pay a higher attention to rural markets. They need to produce high quality goods for different groups of consumers and make their products unique. Simultaneously, they need to attach more importance to distribution development and consider a distribution network as a base to define the relation between production, distribution and sales as well as a base to form a stable sales network.
State authorities must pave the way for businesses to develop distribution networks, aimed at developing powerful Vietnamese distributors. Sector and locality authorities must acknowledge the importance of this. The situation, in which foreign distribution investors are welcomed, while domestic distribution investors are not welcomed, needs to be stopped. Every Vietnamese, especially every Vietnamese manager/leader needs to thoroughly understand and follow the guideline stated in many Party Committee resolutions, which says that internal force is integral, while external force is important. The domestic market and domestic businesses are important elements that make up Vietnam's internal force.
Lifting barriers that deter investment and trade from development, promoting production development, market expansion, and simplifying administrative procedures especially formalities related to market entrance, investment, basic construction, customs inspection and tax declaration and payments have become a must and are important to reduce costs and help businesses improve their competitiveness. The Government is determined to cut 30 percent of current administrative procedures. This determination is turning into real actions by sectors, ministries and localities. However, operations of different sectors and authorities at different levels must be consistent with each other. If only one part of a system is weak, that can deter the whole system from running efficiently.
Along with administrative reform and creating favorable conditions for trade and production, the Government will be focusing its growth promotion program on agricultural and rural development while improving credit guarantee policies for small to medium-sized businesses and paving the way for these businesses to have easier access to development resources.
Growth sustainability improvement must be considered vital while resources are concentrated on approaching a higher growth and preventing high inflation from returning. It is necessary to strictly manage state investment and state-owned businesses' investment and improve management and salary policies subject to state-owned businesses, while salaries need to be paid in compliance with work efficiency and the efficiency of capital and asset use.
Businesses from all economic sectors need to review processes of production and trading, ameliorate management, efficiently use energy and materials, reduce intermediary costs, and increase the efficient use of resources to improve each business and the economy as a whole. It is important to improve the efficiency of state-owned businesses to make them do a better job in contributing to macroeconomic stabilization and growth promotion.
To improve growth sustainability, apart from the above-mentioned, it is necessary to restructure the economy and transform the growth model. This is integral to increase competitiveness in the context of increasing globalization and economic integration. This restructuring and transformation must be persistently implemented for many years to resource accumulation in each business, each economic sector and the whole economy. It is important to develop progressively while taking a shortcut to keep pace with the outside world in industries in which science and technology develops rapidly and Vietnam has conditions for development. This structuring and transformation needs to be accelerated from 2010.
It is necessary to put in place the preconditions and conditions that are needed for the restructuring. The first thing to do is improving market-oriented economic institutions, technology market development, creating a fair business environment for different economic sectors, accelerating national administrative reform, human resource development, and mobilizing all possible resources for adequate, modern infrastructure. Defining the nature of the restructuring is a must. Restructuring productive industries, economic structure transformation promotion that pertains to individual businesses' restructuring and market strategy adjustment to increase the local content and the added value of goods and services, and developing national businesses and Vietnamese businesses that have a strong, renowned brand and are capable of joining global production and value chains should be the core of the restructuring.
This is a process in which we make a shift from a growth model that mainly relies on capital and natural resources and low-cost labor force exploitation to a growth model that is based on science and technology, high quality workforce and advanced management expertise. Businesses need to acknowledge that in this time of rapid scientific and technological development, science and technology, high quality workforce and advanced management expertise are integral for quality, efficiency and competitiveness approach. When the shift to an advanced growth model is being done, the State creates favorable conditions for businesses to do a good job while businesses play a decisive role in making this shift successful.
In 2010, the Government keeps its preferential loan interest rate policy continuing to assist businesses improve equipment and technology and develop production. But equipment and technology renovation should be compliant with an advanced organization and administration model that can create general efficiency and promote sustainable growth
The third is to solve urgent social problems and to try to reach important achievements in this solution.
Over the past years, the Communist Party, the State and the whole political system of Vietnam has made strenuous efforts to fulfill tasks in the social field and these efforts resulted in certain achievements including important results in poverty reduction and social welfare assurance. However these achievements are not yet sustainable, as the rate of households that have fallen below the poverty line again remain high, while the solution of some urgent social problems is still tardy. People feel socioeconomic development achievements through their real lives and the social environment in which they live daily. People are asking the Communist Party and the State to make real changes in this field. Doing this is important to emphasize the preeminence of our system.
 It is impossible to solve social problems within a short period of time but it is important to make significant progress, while focus needs to be placed on the following issues: 1) To rapidly and effectively implement the poverty program in 62 poorest districts while at the same time reducing the number of poor households and households falling below the poverty line again in other regions; 2) to improve healthcare services, assure food safety and hygiene and protection of the environment; 3) to increase education and training quality especially the quality of university, college and vocational education and training; 4) to control corruption and social crimes; and 5) to reduce traffic jams and floods in big cities.Basic measures to fulfill the above-mentioned tasks include 1) improvement of the legal framework, standards and institutions, 2) to increase education and promotion of the law, 3) to practice publicity and explicitness , 4) to strengthen inspections and seriously punish violators; 5) to increase State investment while at the same time mobilizing every possible resource, 6) to give prominence to duties of sectors, branches and managers while at the same time bringing into play the potential and creativity of the whole political system in fulfilling these urgent tasks.
The fourth is to improve leadership and organization capacity and turn development policies and targets into reality.
Organization is one of basic functions of leadership. Organizational results reflect a system's strength, the skill and spirit of officers and the rightness of the concerned policy.
Effective, prompt organization is a necessity. Executive committees of the Party hierarchy and authorities at different levels, especially leaders must keep an eye on and rapidly deal with any newly emerging problems. It is necessary to have determined leadership and prompt organization to not only turn a policy into resources for socioeconomic development but also improve that policy in accordance with actual demands and people's wishes. New solutions can be found in the reality in specific fields, localities and organizations.
The fifth is to do a good job in policy education and promotion, aimed at creating a high awareness and action-related unanimity for the political system and the whole society.
Development is a general operation process that has many targets. It is a process in which economic, social and environmental issues have interactive and connective relations, and a process that has concrete targets which can be contradictory with each other in the short run. Globalization makes reproduction expand in space and change rapidly in time, while development dynamics might be beyond forecasts and estimates. There is no policy that can cover all socioeconomic phenomena. Hence, the fact that there are different points of view about a concrete policy is normal.
 After making a decision it is important to focus on accomplishing tasks and targets that has been set. It is necessary to make information public and explicit and clarify the Party and the State's policies. Information and education must benefit the country and people, while false information must be rejected to promote the right awareness and high social unanimity. This is especially important for Vietnam, a country that develops from small-scaled production, dominated by a small farmer ideology and the crow syndrome. In this regard, we have been improving and we need to do better than before in the near future.The world economy is changing in an unpredictable way. Hence, it is necessary to keep an eye on development dynamics to have keen, proper policy-based reactions. It is also necessary to take new development opportunities, surmount newly emerging difficulties, reach a higher economic growth and better solve social problems.
It is important to keep close to reality, make determined leadership and actions, dare to confront difficulties to fulfill socioeconomic targets, combine socioeconomic development task accomplishment with national defense and social security, improve external relations, and protect national sovereignty and interests to continue bettering Vietnam's position in the international arena. This will be the best preparation in terms of both development thinking and human resources for sessions of Party committees at different levels and a practical action to greet the 11th national congress of the Communist Party and other important events in 2010./.
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