Vietnam achieved its most of its yearly targets for GDP growth, budget turnover
and reducing budget overspending in 2010 but it failed to reach its goal on
inflation (8 percent), which was 9.19 percent. Inflation was the big concern of
the National Assembly Standing Committee.

Chair of the NA Committee for Economics and Budget Ha Van
Hien said that the consumer price index (CPI) hit 9.19 percent last year due to
the increase of the prices of essential goods. CPI in January 2011 rose by 1.74
percent over December 2010. It is forecasted to continue rising in February.

NA Vice Chair Le Duc Kien is worried that the CPI in reports
may be lower than the real figures, which may be double the GDP growth rate.

Kien said that China,
Laos, Cambodia, India
and Turkey
could maintain high GDP growth rates while successfully controlling inflation.
He asked the government to analyze the situation and seek solutions to balance
growth and inflation.

“To develop the economy and improve living standards,
inflation and CPI must be lower than the GDP growth rate,” he emphasized.

The NA Vice Chair stressed that the imbalance between GDP
growth and inflation is the challenge for Vietnam in 2011.

Le Quang Binh, Chair of the NA Committee for Defense and
Security, asked the government to quickly announce measures to control
inflation. “The prices for cooking and consumer goods are rocketing. The poor and
average income earners feel like they had their pocket picked at the market,”
Binh said.

Chair of the NA Committee for Social Affairs Truong Thi Mai
said that the government should research and predict the CPI for 2011 right now
to have timely measures.

The governor of the central bank, Nguyen Van Giau, said that
to confront inflation, the bank suggested to the government two solutions:
raise interest rates and compulsory reserves. However, in this situation, it is
difficult to use the second. The bank chose the first measure: raise interest
rates to attract money from the people. At the same time, enterprises have to
carefully consider their production and business plans.

The Chief State Auditor Vuong Dinh Hue city said that the
increase of interest rates in 2010 benefited commercial banks but businesses
complained a lot.

Chair of the NA Committee for Justice Le Thi Thu Ba also
didn’t agree with the central bank that high interest rates would urge
businesses to be more careful in business. She said that high interest rate
will cause difficulties for businesses, especially small and medium
enterprises.

Regarding the fluctuations in the foreign exchange market,
Governor Giau of the State Bank of Vietnam explained that Vietnam suffered from
trade deficit for a long time so foreign currency supply-demand is out of
balance.

Chair of the NA Committee for Law Nguyen Van Thuan said that
if the government doesn’t have timely and drastic measures, the imbalances in
the monetary market will be dangerous because the people who are saving money
will buy gold or USD.

“Why the growth rate is always high but people’s living
standards doesn’t grow at the same pace?” This is the question of many
constituents for NA deputies.

Thuy Chung