There are signs of an economic decline in Vietnam as monthly inflation fell to an unusually low level in April and the number of companies in trouble rose, a senior government official says.
"It's not an overstatement to say that there is a decline," said Minister of Planning and Investment Bui Quang Vinh. "The consumer price index fell abruptly, and that is a problem," he said, noting that inflation only inched up 0.06 percent in April.
Vinh also said production was cut back and economic growth slowed down to 4 percent in the first quarter. The number of companies that shut down or suspended operations increased by 9 percent to 14,000 in the first three months compared to the same period last year, he said.
If more negative signs appear within the next month, the government may consider revising its economic growth target of 6 percent for 2012, Vinh said.
"The growth target for next year should be 5.5 percent, or 6 percent," he told legislators at a meeting in Hanoi Friday.
Nguyen Sinh Hung, chairman of the National Assembly, Vietnam's highest legislative body, said economic growth should not be under 6 percent.
"After all it's all about ensuring fast and stable economic growth. Without growth, many goals will not be achieved," he said.
Hung also said it is necessary to stay vigilant and keep inflation in digit numbers as fiscal and monetaries are being eased.
Vietnam increased prices of petroleum products, including gasoline, by between 2.13 and 3.93 percent on Friday. An official from the Ministry of Finance said the hike, the second in two months, could add 0.3 percentage points to the nation's consumer price index.
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