In its conclusion about the economic and social situation in the first quarter of 2009 and key solutions from now to the year’s end, the Politburo emphasised that the government has to further support farmers through soft credits to purchase machinery and equipment for production.

Judging that the world economic situation is developing complicatedly and will continue strongly impacting Vietnam’s economy, the Politburo said that from now to the year’s end, Vietnam needs to highly concentrate efforts on preventing economic slowdown; try to maintain a reasonable, sustainable economic growth rate; keep maintaining macro-economic stability; take initiative in preventing inflation; ensure social welfare, national defence, security, political stability, social order; among which the top priority is preventing economic slowdown.

Strictly practicing thrift

The Politburo noted that there are many economic fields that can grow well when Vietnam implements stimulus solutions, particularly infrastructure, agriculture and rural development. The government needs to promulgate provisional, resolute, timely measures for these areas.

An important mission is expanding the list of those eligible for soft loans of over two-year terms to encourage businesses to invest and develop production in fields that still have outlets, fields that are effective; another is continuing to cut interest rates on development investment and social policy credits to suitable levels.

Along with providing more soft loans to farmers to buy equipment and machinery for production, the Politburo emphasised the need to strongly develop the local mechanical engineering industry to support agriculture.

The Politburo asked the government to improve the effectiveness of state capital use, practice thrift, combat waste, especially in holding meetings, overseas trips, organising festivals and in procurement.

The Politburo also stressed the need for the implementation of policies to assist the poor, ethnic minority groups, to build houses for students with capital raised from government bonds, and economic and social development projects for poor districts.

The Politburo asked the government to consider setting up a housing installment fund to assist low-income earners, to have a policy to support workers who lose their jobs and to conduct salary reform policy at the right pace.

Approving GDP change

Besides solutions to deal with short-term difficulties, the Politburo said that Vietnam must have long-term solutions to make real changes in terms of the growth quality of the economy in the coming years, particularly the goals, development orientation and economic structures, up to the guideline of Central Resolution 9.

According to the Politburo, it is also necessary to take positive measures to gradually improve macro-economic balances, strengthen forecast and warning tasks to gain initiative in preventing the return of high inflation, and to take initiative in mitigating the consequences of natural disasters.

The Politburo agreed to reduce the targeted GDP growth rate and increase budget overspending in 2009. The Politburo assigned the Party and Government Civil Affairs Committees to continue keeping an eye on the situation and develop specific schemes to submit to the National Assembly for approval in the upcoming 5^th session.

PV