Expert clarifies solutions to curb economic recession

To fruitfully realize the socio-economic development norms in 2009, according to PhD. Vũ Đình Ánh, it is necessary to follow the Government’s solutions to prevent economic slump.

To implement flexible monetary and credit policies

The scholar suggested that the monetary and credit policies can be continued by cutting the basic interest rates in line with price and inflation realities and by facilitating medium and small enterprises’ accessibility to credit sources.

Commercial banks should properly loosen monetary tightening, strictly manage risks, especially credit ones, and provide efficient projects with credit, Mr. Ánh asserted.

The exchange rate should be reasonably adjusted in the time to come. Accordingly, currencies of Việt Nam’s major trading partners should be taken into consideration when defining the exchange rate of Vietnamese currency.

To stimulate investment and consumption

Both investment and consumption must be stimulated amid the domestic economic recession. Accordingly, to boost up domestic investment, it is necessary to lessen burdens for the business community by lowering tax rates.

Mr. Ánh stressed that tax reduction is an important solution to ignite investment because it lower production and business costs. Meanwhile, an effective and sustainable way to stimulate consumption is to reduce prices of commodities and services in line with people’s income and purchase power.

Concerning the spending of the State budget and preferential credit, he suggested that important infrastructure projects and effective ones should be prioritized. At the same time, nurturing human resources should be highlighted for sustainable growth.

In 2009, it is necessary to restructure export and import balance toward an export-oriented economy and pay attention to the quality and competitive advantages of Vietnamese commodities and services, said the scholar.

He also emphasized the need to put import activities under strict control in order to avoid the trade deficit. On the one hand, input materials should be replaced by domestic goods and services. On the other hand, policies on tax and special consumption tax should be flexibly enforced to maximize competitiveness of domestic enterprises and regulate income of luxury consumers.

By Hương Giang