VietNamNet Bridge – “In the $1 billion package for demand encouragement, I can affirm to not have discrimination between economic sectors” said Minister of Planning and Investment, Vo Hong Phuc.

The $1 billion for encouraging demand would come from the national foreign currency reserve.

Phuc said the government will launch a $1 billion package to encourage investment and consumption. This $1 billion will come from the national foreign currency reserve, which is approximately $22 billion in total.

According to the official, the $1 billion package, and accompanied measures, such as credit loosening and tax reductions, is necessary in the current economic context.

When will the $1 billion package plan be made public and how will it be allocated?

We are working on it and the encouragement solution package will be announced early-on to meet the needs of the economy. The viewpoint of the Ministry of Planning and Investment is focusing on the encouragement of investment in the construction industry.

$1 billion is not free money. It will be injected into effective projects and those that are highly necessary but do not have sufficient capital yet, for example, projects relating to power, housing for students, and low-income earners.

These are the “addresses” that need capital, and are both practical and valuable. When capital is pumped into these projects, it will stimulate the quiet construction sector, encourage the construction material industry, create jobs and help increase the demand from society.

Does the Ministry of Planning and Investment anticipate the case in which the investment is ineffective and the government can not take back the capital, which will adversely affect the entire economy and the national foreign currency reserve?

We will have to seriously consider when choosing projects for investment. Our viewpoint is we will only invest in projects that we can take back the investment capital.

Some worry that this kind of capital will run to State-owned enterprises only and it would be very concerning to appraise the effectiveness of the investment. What do you think about it?

There will not be discrimination of economic sectors in implementing the demand encouragement package. The government recently assisted small- and medium-sized enterprises, not just the State-owned sector.

Investment in some big State-owed groups and companies will be cut down in 2009. In the $1 billion stimulus package, I can confirm that there will be no discrimination between economic sectors. Both State-owned and private companies that have projects that are suitable to the goals and principle of the program will be invested in.

We can be assured of the seriousness and effectiveness of this $1 billion stimulus package.

(Source: Tuoi Tre)