Government requests over loan interest reduction
During a press conference on April 1, Nguyen Xuan Phuc, Chairman of the Government Office said that the economic growth rate of the first quarter increased by 5.83%, much more than during the same period of last year.
However, the national economy has shown signs of unstableness and unsteadiness. Consumer Price Index (CPI) was high, the credit growth rate was 2.19%, and trade deficit was high.
The government issued resolutions to address these challenges with solutions aimed at bringing stability to the economy. Accordingly, the State Bank will give loans with negotiated interest rates applied to effective projects and cut down loan interest rates in order to ensure production and trading.
Regarding this issue, Nguyen Dong Tien, Vice Governor of the State Bank admitted that loan interest rates are still quite high and the Bank is taking appropriate measures to lower it.
Referring to capital mobilisation, Tien said that during the first quarter resident savings deposits went up 9% whereas enterprise deposits rose very little.
Currently, the State Bank is implementing methods to support credit organisations.
According to Tien, negotiated interest rates will also be applied to short term loans.
Regarding CPI, representatives from the Ministry of Planning & Investment said this year the CPI of 8-9% mentioned at previous meetings among ministries and departments was just a forecasted number in case solutions aren’t effective. However, the Government is targeting an inflation rate of 7%.
As for petrol price increases, which are a major concern for the public, Tran Van Hieu, Vice Minister of Finance, said that in the line with world’s current petrol prices, petrol companies are not allowed to increase the price. They can only use the price stabilisation fund.
If the global petrol price decreases, domestic petrol prices also need to go down. If it rises, they need to report the Ministry of Finance to find solutions.
In addition, in order to avoid negatively impacting consumers, petrol prices now cannot be raised unless 30 days has passed since their last change, unlike the previous limit of 10 days.
The petrol price in Vietnam is one of the lowest in the region, according to officials from the Ministry of Finance. For example, A92 petrol is sold at VND16,900 ($0.88) per liter in Vietnam whereas it is sold at VND19,000 ($1) per liter in Laos, Cambodia and China. It’s sold at over VND24,000 ($1.26) per liter in Singapore.
