Hanoi (VNA) - An 20.8% increase in the base salary for civil servants,public employees, and members of the armed forces from July 1 will lead torises in prices of other goods and services, which may put a pressure oncurbing 2023’s inflation, according to General Director of the GeneralStatistics Office (GSO) Nguyen Thi Huong.

In an interview granted to the Vietnam News Agency, Huongsaid that the Vietnam Electricity (EVN)’s possible increase of electricity prices,the Government’s programmes to support economic recovery and step up publicinvestment disbursement, and the recovery of tourism may also affect the price level in theremaining months of this year. 

Regarding factors affecting 2023’s consumer price index(CPI), she said that Vietnam’s import of many kinds of materials whose pricesare at a high level will put pressure on businesses’ production, thus pushingup prices of domestic consumer goods.

The adjustment of service prices managed by the State in thedirection of correctly calculating all factors and costs into prices of medicaland educational services will have a strong impact on CPI, stated Huong.

In addition, prices of food, foodstuff, beverages, garmentand textiles, equipment and household appliances often increase in the lastmonths of the year and ahead of the New Year holidays. Natural disasters and epidemicscan affect food and foodstuff prices in some localities, which will also makethe index increase, she added.

In order to control inflation to reach the target set by theNational Assembly, the GSO proposes the Government, ministries, sectors andlocalities closely monitor price and inflation movements in the world, andpromptly warn about risks to domestic prices and inflation in order totake appropriate response measures to ensure supply and stabilise domesticprices.

Ministries, sectors and localities need to prepare adequatesupplies of goods, especially food and essential consumer goods and services,to ensure meeting people's needs.

For petrol products, it is necessary to ensure the domesticsupply of petrol and diesel, and at the same time control the price of inputmaterials and increase the use of domestic raw materials to gradually replaceimported sources.

In addition, the Government needs to select the appropriatelevel and time to adjust prices of services managed by the State to prevent theresonance of cost-push inflation and inflation expectations.

The Government also should continue operating the monetarypolicy proactively, flexibly and cautiously, in combination with the fiscalpolicy and other macroeconomic policies to control inflation. In particular, itis necessary to ensure adequate and timely supply of credit capital for theeconomy, Huong said.

The GSO head also suggested ministries and branches to stepup communication work in order to provide timely and transparent information,create consensus in public opinion on the Government's price management, andstabilise consumers' psychology, and stabilise inflation expectations.

According to Huong, Vietnam successfully curbed inflation inthe first half of 2023. Compared to other countries, Vietnam is not in thegroup of countries with high inflation when its inflation in June increased by2% over the same period last year./.