Businesses seen as foundation for economic growth in 2014

Stabilizing the national economy and controlling inflation in 2013 will facilitate economic growth in 2014 and subsequent years.

According to economist Dr Vu Dinh Anh, the overall economic picture is brighter in 2014 than in previous years, provided economic restructuring is further accelerated.

The national economy grew at a rate of more than 5.4% in 2013. Excess stock levels and bad debts were reduced.

The economy's total credit increased 12.5% with lending interest rates equivalent to 2005-2006 levels, indicating business vitality despite ongoing difficulties.

Dr Le Danh said macroeconomic conditions suggest the Vietnamese Government will proceed with economic stabilisation and inflation control.

Danh attributes Vietnam's recent relatively sluggish economic growth to low purchasing power and stagnant credit that defied limited inflation and lower interest rates.

Some of the instability and weaknesses from 2013 and earlier are expected to carry over into 2014.

The 61,000 businesses that were dissolved or ceased operations in 2013 pushed the three-year (2011-2013) cumulative total to 16,000.

This has restricted market supply, budget revenue collection, production, employment, purchasing power, and inventory liquidation.

Economic restructuring hoping to fuel investment growth relies on private businesses and foreign investment.

Dr Anh believes building an equitable investment environment that rewards efficiency is absolutely crucial.

Anh stresses foreign investors want to see a Vietnamese investment environment promoting international economic integration and according with international standards of fairness and transparency.

The Vietnam Chamber of Commerce and Industry (VCCI) says recent studies conducted by domestic and foreign organisations reveal Vietnamese and foreign investors have renewed confidence in the Vietnamese economy's mid and long-term prospects. .

Out of 500 leading Vietnamese businesses, 60% reported 2013's performance was better than a year earlier, and 80% have plans to expand operations in 2014.

Many major foreign groups have similar expansion ambitions. The US fast food giant McDonald- a typical case in point- opened its first HCM City restaurant in early this year.

(Source: VOV News)