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The central bank would continue to monitor the economic performance to adjust monetary policy accordingly, with the aim of keeping the inflation rate around 4% for this year.

Vietnam’s credit growth as of April 16 reached 3.34% against late 2020 and a surge of over 15% compared to the same period of last year.

The figures were revealed during a press conference on the performance of the banking sector in the first quarter held by the State Bank of Vietnam (SBV) today [April 22].

Overview of the conference.

The growth rate by the end of March was 2.93% compared to late 2020, equivalent to VND9,460 trillion (US$411 billion). “In just  two weeks, the credit growth had expanded by an addition of 0.41 percentage points,” said a SBV’s representative.

As of April 5, credit institutions and banks have restructured debt payment for 262,000 customers with a total outstanding loan of VND357 trillion (US$15.5 billion). Meanwhile, over 660,000 customers with existing loans of VND1,270 trillion (US$55.14 billion) were subject to waiver, freezing and reduction of interest rates.

From January 23 to date, banks have provided new loans worth over VND3,160 trillion (US$137.3 billion) for around 456,000 customers with preferential lending rates lower than the level in the pre-Covid-19 pandemic .

Data from the central bank showed by mid-April, the growth rate of M2, which measures money supply that covers cash in circulation and all deposits, increased 2.9% against the end of 2020 and 15.66% year-on-year.

According to SBV’s representative, the bank would continue to maintain its current policy rates to create rooms for credit institutions to lower interest rates for customers, while foreign exchange policies are kept in line with the actual macro-economic performance and the objective of monetary policy.

In the coming time, the SBV is expected to closely monitor the market situation to ensure inflation rate around 4% in 2021 and aid economic recovery.

A key task for the SBV is to tighten credit into risky fields, including real estate, stock market and BOT/BT transportation projects, along with providing continuing support for enterprises and people severely affected by the pandemic.

The Hanoi city government has requested its subordinate agencies to implement a range of measures to boost labor productivity.

A new foreign direct investment (FDI) attraction strategy for the 2021 – 2030 period is among a number of measures pushed forward by Hanoi’s authorities to boost productivity.

Illustrative photo.

The municipal Department of Planning and Investment, the agency in charge of drafting this strategy, is tasked with cooperating with the Ministry of Planning and Investment in initiating the campaign “National productivity” and a national strategy for the development of information technology firms; encouraging private enterprises to expand operations to regional and global markets; working with the Hanoi Institute for Socio-Economic Development Studies in promoting a sharing economy model.

The Hanoi People’s Committee has directed the municipal Department of Industry and Trade to work with the Ministry of Industry and Trade in finalizing a legal framework for e-commerce; focusing on high-added value and sophisticated products; helping firms further integrate in global value chains, particularly those in the manufacturing and processing sector.

The Department of Industry and Trade would continue to contribute to the nationwide ongoing efforts to restructure the industry sector in the 2018 – 2020, with a vision to 2025.

The Department of Agriculture and Rural Development is responsible for setting up restructuring plans for the sector in the 2021 – 2025 period, with a vision to 2030, aiming to industrialize agricultural production, manufacturing and distribution processes.

The local government also asks the Department of Labor, Invalids and Social Affairs to improve efficiency during labor training, so that the workforce is equipped with required skills and capable of taking part in smart production using high technologies.

The Department of Education and Training is tasked with finalizing policies to ensure the development of private educational facilities in line with global trends, placing an emphasis on priority sectors with high impacts on Hanoi’s socio-economic development.

The Department of Information and Communication is urged to facilitate the progress of the proposal for “Establishing of Hanoi smart city until 2025, with vision to 2030” and Hanoi’s e-government.

The city considers digital transformation key to boost labor productivity and socio-economic development. To ensure the target is met, Hanoi expects the business community, government agencies and citizens to actively participart in the process.

The Department of Finance is requested to speed up the privatization and divestment processes at state-owned enterprises under the instruction of the government.

The State Bank of Vietnam – Hanoi branch must ensure provision of sufficient capital for production and business activities, especially those in priority fields.

Last but not least, local authorities at district, ward and commune levels are asked to continue accelerating administrative reform and  business environment improvement, a move considered essential to create favorable conditions for enterprises to expand operations.

With the local government’s tireless efforts to ease doing business, Hanoi attracted US7.5 billion in FDI commitments in 2018 and US$8.45 billion in 2019, taking the lead among localities in Vietnam. In the first four months this year, foreign investors registered to pour US982 million in the city.