At the event (Photo: VNA) The event, organised by theNational Assembly (NA) Office and the parliament’s Committee for EconomicAffairs, was chaired by NA Chairman Vuong Dinh Hue and attended by many leadingVietnamese and foreign experts.
Terence Jones, UNDP Resident Representative, a.i., said Vietnam has introduced two fiscal measures since thebeginning of the pandemic. Resolution 42/NQ-CP on supporting people affected byCOVID-19 was issued in April 2020 and included a support package of 62 trillionVND (2.7 billion USD) to aid 20 million workers who had lost jobs due to thepandemic. A new 26 trillion VND support package was announced on July 1, 2021to help workers affected by lockdowns and social distancing during the mostrecent wave of infections (Resolution 68/NQ-CP).
The Government has takentimely action to reduce the suffering of households that are without income dueto loss of employment or earnings from self-employment, he said.
However, Jones noted, thereis evidence that the support package is neither large enough, nor broad enoughin scope, to protect vulnerable households from income loss resulting fromlockdowns and social distancing.
He recommended a cashassistance programme of 5 percent of quarterlyGDP (or approximately 77 trillion VND) be disbursed over the final months of2021. The multiplier effect of additional consumption spending is greater thanone, which means that a 77 trillion VND package would have a much larger impacton total private consumption and national output.
To achieve the twinobjectives of supporting vulnerable households and stimulating economic growth,the cash assistance programme should be launched as quickly as possible,according to the Acting UNDP Resident Representative.
He held that in addition todelivering immediate support, preparations must also be made for medium-termprogrammes to sustain growth and private consumption if necessary. Supplementalprogrammes could address issues that cannot be managed in the short term.
Illustrative photo (Source: VNA) At the consultation, Can VanLuc, Chief Economist at BIDV and member of the National Advisory Council on Financialand Monetary Policies, said to cope with the pandemic’s impacts, Vietnam issuedfour aid packages with the announced total value of some 1.1 quadrillion VND. However,the Government and credit institutions have just committed to providing about184.7 trillion VND, equivalent to 2.94 percent of last year’s GDP.
The implementation of fiscalaid and social security packages remains sluggish, with only about 46 percentof the fiscal aid package and 63 percent of the social security one alreadydisbursed, which has partly affected the effectiveness of support ofenterprises and people, he noted.
Pointing out causes of thisproblem, he called for prompt and drastic implementation of the launched supportpackages, elaborating that the Government should quickly make review and preliminaryassessment and immediately address obstacles to the deployment.
The Government should considermore relief packages worth nearly 40 trillion VND, equivalent to 0.62 percentof the 2020 GDP. It is also necessary to enhance enterprises’ access to capitaland liquidity support. Besides, the State Bank of Vietnam should flexiblyadjust credit growth limits for credit institutions so that these organisationshave more resources for reducing interest rates and supplying credit to aideconomic recovery, according to Luc.
Strategies and plans forpandemic prevention and control as well as socio-economic development in thenew normal should be devised early, the expert said, adding that it isnecessary to have new growth drivers and ensure macro-economic stability inorder to capitalise on recovery chances and control risks.
He also suggested the NA andthe Government soon build a legal corridor for managing and developing the digitaleconomy, society, and administration, and that the Government should step upeconomic restructuring to mobilise and allocate resources more effectively./.
VNA
