Vietnam’s economic growth slowed to 5.9% and annual
inflation soared in 2011 even as the government focused on fighting higher
prices by tightening bank lending.
Inflation rate doubled, rising
to 18.58% this year compared with 9.19% in 2010, government data showed
yesterday.
“The gross domestic product
(GDP) growth in 2011 at around 5.9% is relatively high under the circumstance
of efforts to control inflation,” the government said in a report seen by
Reuters. This compares to GDP growth of 6.78% in 2010.
The consumer price index (CPI)
in December grew 18.13% against the same month last year, easing from an annual
rise of 19.83% in November, the government’s General Statistics Office said in
its monthly report.
“Inflation eased, thanks to the
continuation of tight policy measures,” said Alan Pham, chief economist at
VinaCapital Investment Management Co. “This is a hopeful development.”
Prime Minister Nguyen Tan Dung
said in the government report that Vietnam’s first priority in 2012 would be to
control inflation, with a targeted CPI rise of 9%, while aiming for economic
growth of 6%.
The central bank aims to cut
interest rates next year to make funds easily available for businesses. Dong
loan rates rose as high as 20%-25% earlier this year.
The central bank expects bank
loans next year to rise 15%-17% and money supply to grow 14%-16% from 2011.
The macroeconomic targets for
next year, including plans on cutting rates and the expansion of credit and
money supply, were reasonable given the country’s economic situation, Pham
said.
Reuters
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