VietNamNet Bridge – Viet Nam's annual economic growth rate is likely to be set at 7 per cent for 2011-15. This was agreed on Saturday by most members of the National Assembly Standing Committee at the last working day of its second session.

The proposal will now be put to the 13th National Assembly for approval.

In the socio-economic development plan for the five-year period, the Government proposed two scenarios for the growth of Gross Domestic Product (GDP) - either 7 per cent or 6.5 per cent.

Chairman of the Economics Committee Nguyen Van Giau said his committee agreed with the 7 per cent scenario.

However, he said that to reach this target, growth in 2012 should be from 6 to 6.5 per cent and inflation must be kept at single-digit level to raise the confidence of the population.

This would serve as the foundation for stabilising the macro-economy as well as improving the quality and speed of growth, Giau said.

Phung Quoc Hien, chairman of the Finance and Budget Committee, said, GDP growth of 7 per cent was acceptable.

"We cannot choose fast growth along with sustainable development. Under the current domestic and world economic circumstances, we are only able to manage sustainable development, and we should do so," he said.

"We do not have enough resources to reach the two targets of fast growth and sustainable development at the same time.

We have an inconsistent legal system, poor management capacity, chronic shortcomings in the economy - and we are still suffering impacts of the world economic crisis."

Hien said the inflation rate in 2012 must be no higher than 8 per cent and in 2013 at about 6-7 per cent so that 5 per cent inflation could be achieved by 2015. This should be about 2 per cent lower than the GDP growth rate.

He added that the Government should increase national reserves so there would be enough financial capacity to deal with any problems arising.

Chairman of the Law Committee Phan Trung Ly said special attention should be given to completing the legal framework, which was important solution for the plan's success.

Opting for the 6.5 per cent growth rate, NA Deputy Chairman Uong Chu Luu and Chairman of the Ethnic Council Ksor Phuoc said it was a suitable rate when taking into account the difficulties the economy was facing and disadvantages caused by natural disasters.

NA deputy chairwoman Nguyen Thi Kim Ngan said the five-year plan should be divided into two periods.

"In the first three years, we should focus on stabilising and restructuring the economy, and ensuring social security," she said.

"This would be a run-up to reach a fast growth in the two following years, so that we could reach 7 per cent GDP growth."

NA Chairman Nguyen Sinh Hung asked the Government to analyse the reasons for the shortcomings during the past year to set suitable socio-economic targets for the next five years.

According to the Government's report, it is estimated that GDP will grow by 5.8-6 per cent this year compared to the target of between 7 and 7.5 percent, and the value of exports will increase by 31.6 per cent. Total social investment capital will go up 34.5 per cent and the consumer price index (CPI) will rise by 18 per cent.

It admitted that six out of 22 targets set for 2011 would not be achieved. These included economic growth, CPI, total social investment capital, the number of villages meeting the criteria for new rural areas, the reduction of the number of poor households and the number of rural people with access to safe water supplies.

Foreign direct investment (FDI) for the first nine months of this year was estimated to reach US$8.2 billion, up 0.2 per cent compared to the same period in 2010.

A total of 675 new projects were granted investment licences and they had total registered capital of more than $8.23 billion.

Capital disbursed from Official Development Assistance (ODA) amounted to be $2.15 billion, equal to 89.6 per cent of this year's expected total.

On Saturday, the last working day of its second session, the NA Standing Committee discussed a Government report on the implementation of socio-economic plans and State budget estimates for 2011; socio-economic development orientations, tasks and plans and State budget estimates and allocations for 2012; the socio-economic development plan for 2011-15; national target programmes for 2011-15; and the use of Government bonds over the same five years.

VietNamNet/Viet Nam News