Vietnam to Spend VND300 Trillion to Boost Growth
Mar. 5 – As part of its overall annual budget, the government announced that it would allocate RMB300 trillion to cope with the slowing economy.
The money will be used to improve infrastructure, help exports, and invest in social security projects. The figure is close to a quarter of Vietnam's US$$71 billion economy.
For 2009, the government is forecast to spend VND491 trillion, an increase of 23 percent higher compared to last year.
“The spending will help boost economic growth and investors’ confidence,” Cao Sy Kiem, president of the Vietnam Association for Small and Medium-sized Enterprises, told Bloomberg.
Last year, the Vietnam's stock index plunged 66 percent on fears that the global slowdown would affect the economy.The government is preparing to release an economic stimulus package worth US$6 billion for spending, tax breaks and related measures.
Vietnam’s economy grew by ony 6.2 percent last year, the slowest pace in nine years because of declining export orders from U.S, Japan and Europe. The government said VND17 trillion from the stimulus package will be set aside for loans for companies dealing with export, import or production of essential products.
Vietnam’s National Assembly approved a plan to raise VND55 trillion selling bonds this year to fund the stimulus measures, according to a statement made on the website of the Vietnam Banks Association.
Vietnam will sell U.S. dollar-denominated bonds for the first time in more than three years beginning this month.