The Ho Chi Minh City government will try to stabilize market prices and boost infrastructure development to fulfill the city’s 11 percent growth target for the year, leaders said at a recent meeting.
The total deposit amount has so far this year reached over VND621 trillion (US$32.7 billion), up 25.8 percent year on year, Ho Huu Hanh, director of the HCMC branch of the State Bank of Vietnam reported at the April 26 gathering. Local agencies were meeting to review economic performance over the period.
The total lending amount, meanwhile, has amounted to VND565 trillion ($29.7 billion), up 32.8 percent, he said.
Despite such increases, businesses have found it hard to access loans due to high lending rates. But commercial banks said they could not lower the rates down to 12 percent as requested by the Prime Minister, he said.
Banks explained that they had previously taken in deposits at high interest, so they need to have a certain period of time in which they use up such high-interest deposits before lowering lending rates, he said.
In an effort to restrain inflation, the city People’s Committee said it would launch a plan in May to stabilize the prices of essential goods from now until the end of the year.
The plan will be carried out immediately after it is released, the government said.
Infrastructure development
The government also said boosting traffic infrastructure would be one of the key tasks in May and the months to follow.
He asked the City Development Research Institute to figure out how to overcome the lack of capital for traffic infrastructure.
Nguyen Trong Hoa, head of the Institute said a number of solutions could be considered and applied, depending on the specifics of each infrastructure project.
One of the solutions may be the replacement of the BOT (build-operate-transfer) form with a method he called “grant land and get infrastructure in return”, which would grant investors land for building infrastructure in the city.
Positive signs
The meeting also heard the city Department of Statistics report on economic progress made so far this year.
Industrial output value in the January-April period was over 174.7 trillion ($9.2 billion), up 14.5 percent from a year earlier, according to the department.
The private sector posted the highest growth, at 15.6 percent, followed by the foreign-invested sector, with 14.5 percent, and the State-owned sector, 12.7 percent.
With a growth of 37.9 percent, electronics and telecommunication took the lead in industrial output, then came mechanics and manufacturing (31.1 percent), chemical production (16.6 percent), and construction materials (15 percent).
The period saw total sales of goods and service increase by 22.3 percent and CPI rise by 4.02 percent year on year.
Export turnover also grew by 18.3 percent from last year, with many key export items posting their growths, such as rice (up 19 percent), textiles and garment (13 percent), milk (10.4 percent), and footwear (10.1 percent).
According to the latest data from the department, the city’s GDP in 2009 was 8.5 percent, 0.5 percent higher than the previously reported figure.
