Oct 23, 2012

Vietnam - Vietnam PM Nguyen Tan Dung admits 'faults' on economy

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HANOI: Vietnam's prime minister admitted on Monday that his government had made mistakes in its stewardship of the troubled economy, in the latest bout of self-criticism by the secretive Communist regime.

Scandals, inefficiencies and major losses at state-run giants such as shipbuilder Vinashin have dented public confidence, Prime Minister Nguyen Tan Dung told the opening session of the month-long National Assembly.

"I recognise my political responsibility and my faults," he said, citing Vinashin by name. "We have learned our lesson."

He warned parliamentarians that economic growth was likely to be just 5.2 per cent for 2012 - the slowest rate in 13 years. The government had previously targeted growth of up to 6.5 per cent for this year.

"Vietnam's economy still has many limitations and weaknesses - the macro-economic situation is not good, inflation may rise again, toxic debts are increasing," he said.

Dung, 62, escaped punishment at a key Communist Party meeting last week over a recent string of scandals that have touched the country's leadership.

But in an attempt to deflect increasing online criticism, the party issued an unusual rebuke against its own performance.

Experts say Dung's political rivals, notably Communist Party Secretary Nguyen Phu Trong and President Truong Tan Sang, seem to be using the crisis to try to reduce the power of the prime minister.

Dung, a former central bank governor whose second five-year term was approved by the communist-controlled parliament in July 2011, is said to have become the country's most powerful prime minister ever.

Seen as a moderniser when first appointed, he pushed for rapid economic growth and relied on state-owned giants to drive the economy.

But the near-collapse of scandal-tainted Vinashin in 2010 put the spotlight on the financial troubles of the state-owned companies.

The arrest in August this year of a disgraced multi-millionaire banker seen as an ally of Dung further shook investor confidence in the country.

Vietnam is now grappling with slowing economic growth, resurgent inflation, falling foreign direct investment and rising fears about toxic debts in the fragile banking system.

Dung said the government's top priority for 2013 was to stabilise the macro-economy and keep inflation -- which hit 23 per cent in August last year but has since fallen to single digits - under control.

He warned that "the Vietnamese economy will still have many difficulties in 2013," but said the government was targeting 5.5 per cent economic growth for that year and wanted to keep inflation to eight per cent or less.

Dung took aim at online newspapers and blogs that have published what he called "negative information" about the economic woes, calling for those who "take advantage of the Internet to sabotage the country" to be punished.

Under Dung, authorities have tried to crack down on bloggers with a series of harsh jail sentences.



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