Inflation set to hit 19 percent by end-2011: NA committee

TN News

Email Print

Vietnam's inflation is slowing but it will still hit 19 percent by the end of the year as one of the world's highest rates, the National Assembly 's Economic Committee has forecast.

That inflation level would put Vietnam on the list of four countries with the highest inflation rates in the world, the committee said in a document sent to legislators this week. "This means there are still many hidden risks concerning economic stability in Vietnam," the committee said.

The country now has Asia's highest rate of inflation. Consumer prices rose 21.59 percent in October from a year earlier, according to data released by the General Statistics Office in Hanoi Monday. That is compared to 22.42 percent in September.

Vietnam's government aims to bring inflation down to a single digit in 2012, a goal that the Economic Committee said can be achieved only by consistent policy tightening.

The government needs to continue cutting spending and investment and channel capital flows toward sectors with high investment efficiency, like small and medium-sized enterprises and companies in the production sector, the committee said.

Nguyen Duc Kien, deputy chairman of the committee, told Thanh Nien that fiscal and monetary measures under Resolution 11 will have to be implemented more effectively next year to rein in inflation.

The government, for instance, needs to be more specific with the sectors and projects that it wants to focus on so that it doesn't have to spread its capital too thin, Kien said.

There should also be measures to encourage local businesses to turn to new capital sources like the stock market, instead of depending on banks, he added.

More Business News