The Government’s regular meeting – October 2014
09:38 | 11/11/2014

GOVERNMENT     

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No.  79/NQ - CP

SOCIALIST REPUBLIC OF VIET NAM

Independence - Freedom - Happiness

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                  Ha Noi, November 3 , 2014



RESOLUTION

The Government’s regular meeting – October 2014

GOVERNMENT

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Government’s Decree 08/2012/ND-CP, dated February 16, 2012 promulgating the Working regulation of the Government;

Based on the discussions among the Cabinet members and the conclusion of the Prime Minister at the Government’s regular meeting held on October 29, 2014.

RESOLVES:

1. Regarding the socio-economic performance in October and the first ten months of 2014; the implementation of the Government’s Resolution No. 01/NQ-CP, dated January 2, 2014 on key tasks and solutions guiding the realization of the socio-economic development plan and State budget estimate in 2014.

The Government unanimously agreed that: The socio-economic performance in October and in the first ten months of 2014 witnessed positive changes. The economy maintained recovery pace in all key sectors and fields. Inflation was tamed, consumer price index increased slowly. Credit structure moved positively; exchange rate, foreign currency market were stable. Exports maintained high growth pace, trade surplus was on the rise. Industrial production, especially processing and manufacturing, grew faster than that of the same period last year. Agricultural production grew fairly high. Foreign arrivals to Viet Nam increased against the same period. ODA disbursement picked up fairly. FDI inflow continued to change positively. State budget revenue was higher than that of the same period; budget spending was ensured as planned and in urgent emerging cases. Public debt remained below the safety limit [allowed by the National Assembly]. Social welfare was guaranteed. Administrative reform was strengthened. Improvements were made in reforming business environment with rising business confidence. Political security and social order and safety were maintained. Positive achievements were recorded in diplomatic activities.

However, businesses still faced numerous difficulties; purchasing power increased slowly; securities market developed unstably; real estate market recovered sluggishly. The process of State-owned enterprise equitization and divestment failed to meet requirements. A proportion of the population, especially poor households and ethnic people still struggled to find jobs and earn their living. Some human epidemic diseases developed complicatedly. Food hygiene and safety work revealed shortcomings. Many serious fires and explosions ocurred  in big cities. Meanwhile, the regional and international situation evolved with complexities, adversely affecting the country’s socio-economic development.

In order to realize the socio-economic development plan for 2014, the Government required ministries, agencies and localities to strive for the realization of the overall goal and socio-economic tasks and targets identified early in the year; solutions and tasks enshrined in the Resolution No. 01/NQ-CP and other Resolutions adopted at the Cabinet’s monthly meetings; take concrete and practical measures to remove difficulties against business and production, restructure the economy, reform administration, improve business environment, enhance competitiveness, guarantee social security and social welfare as well as political security and social order and safety, focusing on the following tasks:

- The State Bank of Viet Nam shall create favourable conditions for enterprises to access to credit, speed up credit growth and guarantee credit quality in accordance with the specified targets; enhance the control over the operations of the banking system, and resolutely restructure poorly-performed credit institutions.

- The Ministry of Finance shall effectively supervise and speed up, and inspect State budget collection; enhance inspection in order to timely detect and handle tax fraud and evasion, transfer pricing, tax revenue losses; step up the fight against smuggling; strictly control State budget for absolute thrift practice and effectiveness.

- The Ministry of Planning and Investment shall take prime responsibility and accelerate the implementation and disbursement of development capital; continue to review and design mechanisms and policies in order to further lure resources for production and business development; encourage private investment, public-private partnership (PPP) in infrastructure development; speed up the FDI attraction, especially environmentally friendly and hi-tech projects; perform measures to assure the quality, progress and effectiveness of works supported by ODA and preferential loans; review and correct the ineffective use of ODA.

- The Ministry of Trade and Industry shall supervise and speed up industrial production activities, especially processing and supporting industries; enhance production capacity and strive to outperform the preset plans for advantegous fields; beef up trade promotion to expand export markets and diversify partners; actively engage in negotiations on free trade agreements; develop domestic market and ensure supply-demand balance and the quality of goods, especially essential consumption ones during the year-end period; strengthen market management and smuggling fight, prevent the trading of counterfeit commodities, goods without clear origins or unhygienic and unsafe ones.

The Ministry of Agriculture and Rural Development shall deploy the breeding and production plan for the rest of the year; enhance the prevention of dangerous epidemic diseases on livestock and poultry; develop aquaculture in combination with quality control, technical standard assurance for export; actively coordinate with ministries, agencies, localities to deploy measures to cope with natural disasters in order to minimize losses thereof.

- The Ministry of Transport shall strengthen quality supervision and speed up progress of major traffic works; coordinate with the Ministry of Public Security and localities in ensuring traffic order and safety, managing vehicle loads, and imposing strict sanctions against those who commit to wrongdoings in controlling vehicle loads.

- The Ministry of Labor – Invalids and Social Affairs shall take prime responsibility and collaborate with ministries, sectors and localities in directing the implementation of social security and social welfare policies; fruitfully realize programs on poverty reduction, job creation, and manpower export as well as policies in favor of people with meritorious services to the nation and their relatives; improve the quality and effectiveness of market-based vocational training.

- The Ministry of Education and Training shall continue to drastically implement the Government’s Action Program to realize the Resolution on basic and comprehensive education and training innovation which was adopted at the 8th Plenary session of the 11th Party Central Committee.

- The Ministry of Health shall improve the quality of medical examination and treatment, and healthcare; well perform preventive medicine and epidemic diseases prevention; ensure food hygiene and safety.

- The Government Inspectorate shall well implement the Law on Reception of Citizens and Decree No. 64/2014/ND-CP of the Government; coordinate with ministries, sectors, localities in settling citizens’ claims and denunciations, especially prolonged and collective claims; organize the citizen reception in accordance with regulations, actively arrange dialogues with citizens and completely handle cases at grassroots levels; intensify anti-corruption; conduct inspections and make public results thereof while supervise and speed up the implementation of post-inspection decisions and the Prime Minister’s post-inspection instructions.

- The Ministry of Public Security shall drastically crack down on criminals; enhance the inspection of fire and explosion prevention, especially in big cities and residential areas; coordinate with the Army in detecting and preventing acts that trigger insecurity and disorder.

- The Ministry of Information and Communications, other ministries and agencies shall actively coordinate with information and communication agencies in timely dissemninating guidelines, policies, orientations of the Government and sectors; actively demonstrate their accountability over issues of public concern; mobilize businesses and citizens to strive for the realization of the national socio-ecnomic development plan.

- The Cabinet members shall actively demonstrate their accountability, participate in socioeconomic performance discussions and respond to the deputies’ questions at the 8th working session of the 13th National Assembly; proactively make plans and action programs for the realization of Resolutions approved by the National Assembly; strictly implement commitments at the National Assembly and handle voters’ petitions; promptly develop and promulgate legal documents on detailed implementation of laws and ordinances right after they come into effect.         

- Relevant ministries and agencies shall coordinate with the Viet Nam Chamber of Commerce and Industry to actively implement the Prime Minister’s Directive No.11/CT-TTg dated on May 21, 2014 on solving difficulties and recommendations of enterprises and promoting their production and business development; and continue to consider and handle specific petitions of the business community.

- Ministries, agencies and provincial and municipal People’s Committees shall continue to improve performance effectiveness by taking concrete measures with highest determination to fulfill the remaining tasks set for 2014; tackle obstacles against production and business, promote the socio-economic development, and create drastic changes in advantageous areas of each locality; review their performance as well as the implementation of working programs in 2014;  design tasks, solutions and the working programs for 2015 in line with the goals and tasks enshrined in the five-year plan for the 2011-2015 period.

2. Regarding public debt

The Government agreed: Due to the consequences of the financial crisis and global economic recession, our country’s economic growth has slowed down, which significantly affected State budget revenue while the State had to reduce tariffs in order to support businesses and needed more resources for stimulus packages, salary reform, social welfare policies, and the infrastructure development – one of the three strategic breakthroughs. That leads to a sharp increase in public debt from 51.7% of the GDP in 2010 to about 60.3% of the GDP at the end of 2014. On the other hand, as Viet Nam has become a middle-income country, the ratio of ODA and preferential loans with long maturities and low interest rates has gradually dipped. So Viet Nam has shifted to domestic borrowings in accordance with the Resolutions of the Party and the National Assembly. The ratio has increased mainly through the issuance of short-term Government bonds, thus putting more pressure on the Government to pay short-term liabilities.

Against that backdrop, we had to fulfill our debt liability without overdue loans. The public debt indicators were within the limits figured out in the National Assembly’s Resolution. Public debt is a crucial source of capital for the socio-economic development. More than 98% of the loans have been channelled directly to infrastructure projects. The rest was shifted into the State budget for investment (1.5%) and non-business expenditures for ODA projects as committed (0.4%). Many important and essential projects on transport, electricity, water supply, irrigation, health and education, etc have been completed and proved to be effective and a number of new projects are underway in order to further attract domestic and foreign investment, foster economic structure and promote production and business efficiency and economic growth, which will contribute to increasing State budget revenue and ensuring resources for debt payment liability.

In the future, the Government will continue to direct ministries, agencies and localities to closely monitor public debt, especially new loans (including the loans of the Government, loans guaranteed by the Government and loans of the local authorities), ensure public debt within the allowed limits; steer the loans to planned projects on socio-economic infrastructure; strengthen loan supervision to make sure that they are used effectively and in accordance with legal regulations; promptly restructure public debt in the direction of increasing the ratio of long-term loans with low interest rates; tighten control of Government-guaranteed loan payment and recover debts arising from refinanced loans; fulfill the scheduled debt payment liability by arranging resources from State budget and accumulation fund; review and improve institutions, amend and supplement the Law on State Budget, the Law on Public Debt Management, the medium-term debt management Strategy and Program; gradually reduce public debt norms for the 2016-2020 period and guarantee national financial safety.

The Ministry of Finance shall take prime responsibility and coordinate with the Ministry of Planning and Investment and the State Bank of Viet Nam in drafting and submiting a draft Directive on enhancing the management and effectiveness of public debt in the future to the Prime Minister for approval.

3. Settlement of non-performing loans

The Government agreed:  the State Bank of Viet Nam, agencies, credit organizations and business community have made tremendous efforts in dealing with non-performing loans (NPLs); actively deloyed the plans to handle NPLs in association with restructuring each credit organization; focused on supervising and inspecting the observation of regulations on operation safety, asset quality, financial health, NPLs and settlement results; simultaneously improved the regulations on debt structure and classification and risk provision towards more transparency and compatibility to international practice. As of October 2014, 54.5% of the NPLs were settled. The proportion of NPLs stands around 3.8% and tends to decrease based on the reports of credit organizations.

In the time to come, the Government will continue to accelerate bad debt treatment in combination with restructuring credit organizations by completing the legal framework, especially regulations on collateral settlement and creditors’ rights; improve the functions, strengthen financial health and capacity and bring into full play the role of the Viet Nam Asset Management Company (VAMC); facilitate the development of debt market; encourage domestic and foreign investors to join bad debt trading; make public bad debts and treatment outcomes; strengthen inspection and supervision of bad debts and credit quality; enhance coordination among ministries, agencies and localities in dealing with bad debts; ensure macro-stability, develop healthy securities and real estate markets, foster the implementation of the restructuring pillars and growth in order to support bad debt settlement and restructure credit organizations. The bad debt ratio is expected to dip to 3% by the end of 2015.

4. Regarding the draft Decree on mechanism and policy on forest protection and development in association with the policy on poverty reduction and support for ethnic minorities in the 2015-2020 phase.

The Ministry of Agriculture and Rural Development shall take prime responsibility and coordinate with the Ministry of Finance, the Ministry of Planning and Investment, the Committee for Ethnic Minority Affairs, the State Bank of Viet Nam and other relevant agencies to collect comments from the Cabinet members; review the current policies on forest protection and development, poverty reduction and ethnic minorities; integrate, adjust and supplement these policies in accordance with budget balance so as to fruitfully realize the goals of protecting and developing forests, raising incomes and reducing poverty among ethnic people and residents in extremely disadvantaged communes and mountainous areas; then finalize and submit a draft Decree to the Government for consideration and decision.

5. Regarding the Draft Decree stipulating autonomy mechanism of public non-business units

The Ministry of Finance shall take prime responsibility and coordinate with the Office of Government to collect comments from the Cabinet members and finalize the draft Decree stipulating autonomy mechanism of public non-business units, then sumit it to the Prime Minister for issuance.

6. Regarding the local government organization model

The Ministry of Home Affairs shall collect comments from the Cabinet members to finalize the Project on local government organization model and report to the Leading Party Members' Group before submitting to the Political Bureau.

Based on the conclusion of the Political Bureau, the Ministry of Home Affairs shall continue complete the project and report to the Leading Party Members' Group before submitting to the 10th plenary session of the 11th Party Central Committee.

Pursuant to the Constitution in 2013, conclusion of the 10th plenary session of the 11th Party Central Committee, and discussions at the 8th working session of the 13th National Assembly regarding the draft Law on Local Government Organization, the Ministry of Home Affairs shall finalize the bill and report to the Government before submitting to the National Assembly at its 9th working session.

7. Regarding the Government’s draft Resolution on measures to accelerate Viet Nam’s tourism in the new period.

The Ministry of Culture, Sports and Tourism shall take prime responsibility and coordinate with the Office of Government and other relevant ministries and agencies to collect comments from the Cabinet members, thereof finalize the draft Resolution and submit to the Prime Minister to issue in November 2014.

8. Regarding the reduction and exemption of non-agricultural land use tax in 2014 for communes and towns in Son Tinh district, Quang Ngai province after the district became part of the Quang Ngai City in accordance with the Government’s Resolution 123/NQ-CP dated December 12, 2013.

The Government agreed with the Ministry of Finance’s proposal to reduce 50% of payable tax amount in 2014 for residential land of households and individuals in all communes and towns in Son Tinh district. Since 2015, they shall have to pay non-agriculture land use tax in accordance with the Government’s Decree No. 53/2011/ND-CP dated July 1, 2011. The Ministry of Finance shall be assigned to provide specific instructions./.

ON BEHALF OF THE GOVERNMENT

PRIME MINISTER

(Signed)

 

Nguyen Tan Dung

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