LookAtVietnam – Vice chairman of the National Assembly’s Committee for Finance and Budget Dinh Van Nha, says the second stimulus package will need to be approved by the National Assembly.

Government gives the nod to a second stimulus package

The situation was discussed in depth in an interview with Vietnam’s Economic Times.

Vietnam Economic Times: Does the NA’s Committee for Finance and Budget agree with the government’s second stimulus package?

Dinh Van Nha: The committee discussed and agreed with the government’s proposal. However, the government will have to report to the National Assembly. The NA will make the final decision about package when it ratifies the social-economic development plan for 2010. The government has the legal basis for implementing the package. However, the NA will not consider the contents of the stimulus policy but the sources of capital for that package.

VET: You have mentioned the “legal foundation” to carry out the second stimulus package. But at a recent NA discussion, deputies criticised the government for implementing the first stimulus package without asking the NA’s approval. What do you think about it?

Nha: The first stimulus package was implemented in February 2009 while the NA ratified the social-economic development resolution for 2009 in late 2008. At that time, the NA’s fifth session was yet to start so the government temporarily carried out the first stimulus package and then reported to the NA’s fifth session.

This time the government has defined its policy early so it will report to the NA at the ongoing session for approval.

VET: If over half of NA deputies don’t agree with the second stimulus package, will the package be canceled?

Nha: I think these circumstances will be unlikely because through discussions, many deputies have said they want the government to launch the second package to meet the needs of the people.

VET: In this NA session, both the NA’s Committee for Finance and Budget and the Committee for Economics suggested the government stop the short-term interest rate subsidy policy but the government still decided to apply the policy until March 2010. What is your reaction?

Nha: The number of deputies in the two committees account for a small percentage of the total NA deputies. Many other deputies asked the government to continue the short-term interest rate subsidy policy but reduce the subsidy to 2 percent from 4 percent and narrow the range of beneficiaries. This policy is mainly for household-sized businesses and small and medium enterprises in agriculture. Actually, the first stimulus package has been effective.

VET: Do you think that the NA will agree with the government’s second stimulus package?

Nha: Yes, I strongly believe it. The government has just decided the second stimulus package but NA deputies considered the continuation before they went to the NA’s 6th session so they have sufficient information to approve the package.

If the NA approves the second stimulus package, it will have a big influence on production in 2010 because many businesses have invested in facilities already and it would be a big problem if they were not supported further. So the second stimulus package should be made public as soon as possible.

VietNamNet/TBKTVN