MPI predicts export growth rate may be zero percent this year

The 15 norms will be listed in the group of to-be-fulfilled norms, while the other seven will be put in the not-to-be-fulfilled group. In the later group, MPI has predicted that the export turnover growth rate in 2009 over 2008 may be zero percent.

The latter group will also comprise the norm of creating new jobs. It is estimated that only 1.45 million new jobs will be created, while the figure the National Assembly has set is 1.7 million. Of this amount, only 80,000 labourers will be sent to work abroad, while the targeted figure is 90,000.

In the to-be-fulfilled group is the norm on state budget deficit, which is estimated at 6.9 percent of GDP.

2009’s export turnover will be the same as 2008’s

In discussing reasons behind the export slowdown, the report cites the factors of the global economic crisis, the narrowed export markets for Vietnam, lower export product prices. The export turnover in the first half of the year has dropped by 10.1 percent over the same period of last year.

However, MPI itself is still optimistic about exports in the last months of the year. Russia and Brazil, big seafood export markets for Vietnam, have been reopened. Meanwhile, Vietnam has been trying to export rice to Africa, wooden furniture to the Middle East and Africa, garment products to the Middle East, Russia and South Africa.

Regarding crude oil, the product that is the biggest foreign currency earner for Vietnam, MPI said that the crude oil price has soared from less than $30 per barrel to $70 and is expected to increase further amid the global economy’s recovery and higher demand for fuel towards the year’s end.

The ministry has estimated that total export turnover in 2009 will reach $62.7 billion, the same level as in 2008.

Explaining about the forecast failure of obtaining the three percent export growth rate set by the National Assembly, MPI said that Vietnam will need to obtain a 16 percent export growth rate in the last six months of the year in order to reach the 3 percent growth rate for the whole year (the growth rate was minus in the first half of the year), which is an unfeasible goal.

Job creation: only 85 percent of plan to be fulfilled

In the first six months of the year, 650,000 labourers found jobs, equal to 83.3 percent of the same period of 2008 (33,000 labourers were exported, or 75 percent of the same period of 2008).

The economic downturn has directly influenced job creation. The GDP growth rate in the first half of the year reached 3.9 percent only, much lower than 6.5 percent of the same period of 2008 and lower than the average level set for this year at 5 percent.

MPI has warned that difficulties will still exist in the upcoming months. It believes that by the end of 2009, only 1.45 million jobs will be created, fulfilling 85.3 percent of the yearly plan and 89.8 percent of the implemented figure in 2008

Budget deficit to be 6.9 percent of GDP

The Government’s fiscal policy, which aims to maintain the GDP growth rate at a reasonable level and minimise bad impacts on people’s lives and help businesses overcome difficulties, will surely affect the collection and spending of the state budget.

MPI has predicted that 375.3 trillion dong will be collected for the state budget, or 101 percent of estimates. Meanwhile, the budget will spend 533.3 trillion dong, or 127 percent of the plan. As such, the state budget deficit in 2009 is expected to reach 125 trillion dong, or 6.9 percent of GDP.

Regarding the implementation of the targets for 2006-2010, MPI has forecast that 22 targets will be fulfilled, while the other 14 will fail. Among the targets MPI says will not be fulfilled are the target on GDP growth rate, added value in industries and construction, state budget deficit and consumer price index increases.