Directive No. 14/2002/CT-TTg on the development plan for economic and social progress and state budget estimate for 2003

DIRECTIVE

Regarding the development of plans for economic and social development and state budget estimates for 2003

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Implementing the Resolution of the National Assembly on tasks and state budget estimates for 2002, the Government has issued many mechanisms and policies and focused on directing efforts to resolve difficulties in production and business activities, mitigate the severe consequences of drought, and address urgent social issues, thereby promoting the implementation of the economic and social development plan targets for 2002.

However, the economy is currently facing numerous acute difficulties. In order to successfully complete the tasks and state budget estimates for 2002, the Prime Minister requests leaders of ministries, central agencies, provinces, and centrally-administered cities to enhance their sense of responsibility and effectively implement the Resolutions of the National Assembly, the economic and social development measures proposed in the Government's Resolutions, particularly Resolution No. 05/2002/NQ-CP dated April 24, 2002 of the Government on certain measures to implement the 2002 economic and social plan.

The task of developing the plan for economic and social development and state budget estimates for 2003 is carried out with the following main requirements and contents:

I. MAIN CONTENTS OF THE 2003 PLAN

1. Main objectives and tasks of the 2003 economic and social development plan:

The year 2003 is the third year of implementing the Resolution of the Ninth National Party Congress and Resolution No. 55/2001/QH10 of the National Assembly on the five-year plan from 2001 to 2005. This is a very important year in completing the goals set for the 2001-2005 five-year plan.

Based on the general objectives of the five-year plan from 2001 to 2005, the results of the 2001 plan and the first six months of 2002, the main objectives of the 2003 plan are: To promote high and stable economic growth; make significant progress in economic structure, labor structure, and investment structure to improve the efficiency and competitiveness of the economy. Effectively implement commitments and integration timelines in the international and regional economies; boost exports while fully exploiting domestic markets. Develop and improve the quality of human resources; vigorously apply scientific and technological achievements in economic and social activities. Continue to implement poverty reduction programs, improve living standards, address urgent social issues, and maintain public order and safety.

The 2003 economic and social development plan needs to focus on the following main tasks:

1. Strive to achieve higher economic growth rates than in 2001 and 2002, creating conditions for sustainable and stable economic development and achieving higher growth rates in subsequent years.

- Continue to promote the restructuring of agriculture and rural economy towards quality and efficient commodity production, linking production with domestic and international consumption markets; form specialized commodity production areas, develop animal husbandry, aquaculture, forestry suitable to the potential and strengths of each region. The value of agricultural, forestry, and fishery production increases by more than 4.5%; significantly reduce production costs to achieve a total industry GDP increase of about 3.3%.

Encourage the application of new scientific research and technology outcomes, especially biotechnology, clean production technology, innovation in processing some agricultural products, primarily coffee, rubber, tea, cashew nuts, meat, milk, seafood, etc., to enhance productivity, ensure quality, and increase product competitiveness. Encourage the production and consumption of agricultural products with competitive advantages and good market prospects. Vigorously develop traditional crafts, village industries, and rural infrastructure to create new jobs, facilitate the shift of agricultural labor to non-agricultural production, and promote rural economic development. Actively prevent natural disasters and respond to adverse weather conditions.

- Develop industry at a high rate, focusing on products with advantages and high competitiveness in both domestic and foreign markets. Maintain an industrial production value growth rate of 14%; strive to reduce production costs, especially in processing industries, fully and efficiently utilize domestic raw materials to achieve a total industry GDP increase of over 10%.

Enhance the competitiveness of industrial products, deepen investments, prioritize the development of manufacturing industries, especially high-tech industries, export-oriented industries, and processing industries serving agriculture and rural economies.

- Continue to intensify the reorganization, reform, and improvement of the operational efficiency of state-owned enterprises according to the Government's Action Program to implement the Central Committee's Resolution 3. Promote the shareholding of state-owned enterprises where the State does not need to hold 100% equity; merge, dissolve, or declare bankruptcy for unprofitable enterprises; at the same time, create all favorable conditions for effectively operating enterprises that have been privatized. Continue to expand pilot state corporations and state-owned enterprises operating under the holding company model, forming several state economic groups in telecommunications, oil and gas, electricity, and construction.

- Diversify and improve the quality of various service sectors such as tourism, financial services, banking, auditing, legal consultancy, postal and telecommunications, transportation. Strive for a service sector value increase of over 7%; reduce intermediary costs in service sectors to achieve a service sector GDP increase of approximately 6.6%. Establish mechanisms to attract capital from various strata of the population for service and tourism development.

- Expand the domestic market, especially rural and mountainous markets, and establish close connections between regions nationwide.

2. Enhance the effectiveness of foreign economic activities. Focus on promoting exports, importing only goods that cannot be produced domestically. Consolidate existing markets and actively expand new markets, with particular emphasis on the US market. Raise awareness among industries, localities, especially enterprises, about the urgency and increasingly fierce competition in current international integration. Gradually improve the quality of exported goods, rapidly increase the proportion of processed goods in exports, and promote labor export. Create favorable conditions to attract foreign direct investment; effectively utilize and manage official development assistance (ODA) funds and technology, and proactively integrate into the international economy.

3. Continue restructuring the state budget, prioritizing investment for development, implementing social policies, and poverty reduction; increase spending on education and training, science, and technology. Thoroughly implement thriftiness alongside enhancing the efficiency of state capital and asset utilization.

Continue to strengthen and improve financial and credit health, enhance the quality of banking service activities. Focus investment on projects with high socio-economic benefits, affecting multiple economic sectors, and having a high export ratio.

4. Rapidly increase social investment, fundamentally improve the savings-to-consumption ratio, mobilize over 35% of GDP for development investment; of which, the state budget allocates at least 25% of total state budget expenditure for development investment. The state budget supports investment in difficult regions, remote areas, and far-flung regions.

Adjust the investment structure to create favorable conditions for economic restructuring to enhance efficiency and competitiveness of the economy. Do not revert to the comprehensive support mechanism.

5. Continue to innovate, bring about fundamental changes in education and training development, vocational training system development, improve human resource quality with a reasonable structure; continue to implement the junior secondary school universalization program. Promote scientific and technological activities, quickly apply advanced technologies, and simultaneously apply research results to production; strengthen environmental protection and improvement work.

6. Effectively address pressing social issues, implement national target programs efficiently, particularly the poverty eradication and employment program. Expand public participation and oversight in infrastructure construction projects for poor communes and poor regions. Continue to focus investment on developing the socio-economy of six difficult mountainous provinces in the north, the Socio-Economic Development Program of the Central Highlands region, and the Socio-Economic Development Program of the Mekong Delta region.

7. Vigorously reform administrative procedures in areas such as institutions, organizational structures, cadre and civil servant队伍建设，以及财政体制改革。增强国家政策的有效性和透明度。尽快完善工资改革方案，以便早日实施。

8. Strengthen national defense and security, combine national defense and security with economic and social development, continue to intensify efforts to suppress criminal activities, and ensure order and discipline in economic and social activities.

2. Tasks for preparing the state budget estimate for 2003:

The basic objectives for building the state budget estimate for 2003: Implementing reasonable mobilization policies to ensure resources for important national tasks; enhancing the internal strength of sectors and localities, proactively concentrating resources to fulfill important tasks; tax and fee revenues must ensure regular expenditures, repay debts due, accumulate funds for development investment; allocate and use funds according to targets, economically, effectively, prevent waste and loss, improve the health of the state budget to contribute to rapid, sustainable economic growth, maintain political stability and social order and safety.

The tasks for building the state budget estimate for 2003 are:

1. The state budget revenue estimate must be built on the basis of accurately calculating all revenue items as prescribed by law, based on analyzing and forecasting factors such as economic growth, market conditions, prices, etc.; fully implementing regulations encouraging production and business, increasing exports, expanding markets; implementing commitments of regional and global economic integration processes; implementing measures to strengthen revenue management, value-added tax refund management, preventing revenue losses and leakage, combating smuggling and commercial fraud.

Building the state budget revenue estimate with a mobilization effort target of about 20-21% of GDP, of which tax and fee revenue should account for 18-19% of GDP. The revenue estimates of Ministries, central agencies, and localities must aim to increase by an average of over 12% compared to the actual level in 2002.

2. Allocating the state budget estimate for development investment to ensure sufficient capital for key national projects, prioritizing capital allocation for projects under Program 135, planting five million hectares of new forests; investment capital for socio-economic development in northern mountainous provinces, Central Highlands, and the Mekong Delta; ensuring sufficient capital for project preparation; allocating sufficient counterpart funds for ODA projects; supporting the production of important products, processing agricultural export products; developing crop and livestock breeds; transforming the agricultural economic structure; developing rural transportation infrastructure, aquaculture infrastructure, village craft infrastructure, tourism infrastructure...

The state budget expenditure estimate focuses on implementing tasks for socio-economic development and poverty reduction; ensuring resources to implement the Central Resolution No. 3 (Session IX) on restructuring, reforming, developing, and improving the efficiency of state-owned enterprises; the Central Resolution No. 5 (Session IX) on reforming, developing, and improving the efficiency of collective economy; reforming mechanisms and policies to encourage and create favorable conditions for the development of private sector; accelerating industrialization and modernization of agriculture and rural areas; ensuring national security and defense; implementing ethnic policies of the Party and State.

Increasing reserves to proactively respond to natural disasters, floods, and handle urgent tasks arising.

Implementing salary reform to create motivation for development and administrative reform. This is an important task that needs to be focused on over the next few years, requiring the reorganization of some tasks to concentrate resources for implementation according to the principle: Ministries, central agencies, localities, and budget-using units must proactively allocate from increased revenue sources, implement thrift, combat waste, and use allocated budgets to have resources for implementation.

Public service units implementing Decree No. 10/2002/ND-CP dated January 16, 2002, of the Government on financial systems applicable to public service units with income, need to manage and use the budget and income sources effectively according to the prescribed system to ensure the development of assigned services and ensure funding for important tasks assigned; based on the 2002 budget estimate already allocated, in 2003, the basic level of funding will remain stable, with an increase according to a percentage rate (%) depending on the industry and field. Study amending and supplementing relevant systems and policies to be consistent with the implementation of Decree No. 10/2002/ND-CP dated January 16, 2002, of the Government.

Study expanding pilot programs for staffing and administrative management cost contracting for state administrative agencies according to Decision No. 192/2001/QD-TTg dated December 17, 2001, of the Prime Minister.

For national target programs: implement according to Decision No. 42/2002/QD-TTg dated March 19, 2002, of the Prime Minister on managing and operating national target programs.

The state budget deficit should not exceed 5% of GDP, appropriate to domestic borrowing capacity and preferential foreign borrowing to offset the state budget deficit.

3. Regarding the local government budget estimate:

Localities build the 2003 budget estimate according to the following principles:

Based on the ratio of revenue distribution, the amount supplemented from the central budget to the local budget (if any) assigned by the Prime Minister in 2002, and the 2003 revenue estimate on their territory to build the local budget balance and the 2003 local budget expenditure estimate; among which, the amount supplemented from the central budget to the local budget is expected to increase by 2-3% compared to the supplementary balance in 2002.

Allocating the 2003 budget expenditure estimate:

- Allocate funds to implement Central Resolutions No. 3 and 5 (Session IX) at the local level.

- Prioritize funds for infrastructure construction, solidifying irrigation channels and rural roads; village craft infrastructure, tourism infrastructure; implementing seed and livestock breed development; transforming the agricultural economic structure; trade promotion activities, expanding and seeking export markets; focusing on implementing poverty reduction, job creation, addressing social evils, supporting ethnic minority groups...

- Localities proactively calculate from increased revenue sources, thrift in regular expenditures to reserve resources for salary reform.

- Allocate local budget reserves as prescribed by the Law on State Budget.

- Allocate the budget to repay all due debts, ensuring the health of the local budget.

Based on the assessment of the implementation of the reinvestment mechanism in previous years (from agricultural land tax revenue, land lease fees, land use fees, etc.), determine the level of targeted supplementary funding from the central budget for local budgets and implement it stably over several years; at the same time, prepare the budget for targeted supplementary funding from the central budget to local budgets for tasks such as the National Target Program, the project to plant five million hectares of new forests, Program 135...

In 2003, implement the bonus mechanism for excess revenue as stipulated in the State Budget Law, the Prime Minister will issue specific regulations thereafter.

II. PROGRESS IN BUILDING THE PLAN AND ASSIGNMENT OF IMPLEMENTATION

1. Regarding the progress of construction:

- By mid-July 2002, the Ministry of Planning and Investment and the Ministry of Finance shall provide the framework plan and state budget estimate for 2003 to relevant ministries, sectors, and localities as a basis for planning.

- Before August 15, 2002, ministries, sectors, General Company 91, provincial people's committees under the central government shall report their economic and social development plans and state budget estimates for 2003 to the Ministry of Planning and Investment and the Ministry of Finance for consolidation and submission to the Government.

- The Ministry of Planning and Investment and the Ministry of Finance shall organize meetings with ministries, sectors, and localities to promptly consolidate plans for submission to competent authorities; simultaneously propose allocation schemes for key indicators and the budget for submission to the Standing Committee of the National Assembly.

2. Regarding division of responsibilities:

1. The Ministry of Planning and Investment:

- Take the lead and coordinate with the Ministry of Finance to calculate and develop various scenarios and major balances as a basis for guiding ministries, sectors, and localities in planning for 2003.

- Organize guidance on building and consolidating the economic and social development plan for 2003.

- Take the lead and coordinate with the Ministry of Finance to forecast the investment development plan and allocate capital for construction projects; take the lead and coordinate with the Ministry of Finance and relevant central agencies managing national target programs to forecast plans and allocate capital for programs and projects.

2. Ministry of Finance:

- Take the lead and coordinate with the Ministry of Finance to guide ministries, central agencies, and localities in evaluating the implementation of the 2002 state budget estimate; build a preliminary budget estimate and notify the revenue and expenditure figures for the 2003 state budget estimate to relevant ministries, central agencies, and localities.

- Take the lead and coordinate with the Ministry of Planning and Investment and related agencies to build and consolidate the 2003 state budget estimate; work with central ministries and localities regarding the budget estimate.

- Based on the Government Decree on financial systems applicable to revenue-generating public institutions, take the lead and coordinate with relevant ministries and localities to guide and organize the preparation of the 2003 state budget estimate for public institutions implementing new financial management mechanisms, and some administrative units implementing self-financing methods (including salaries).

3. Ministries, state agencies, General Companies 91: cooperate with the Ministry of Planning and Investment and the Ministry of Finance to build development tasks and budget estimates within their respective areas of responsibility. Central agencies managing national target programs and the five-million-hectare forest planting project shall cooperate with the Ministry of Planning and Investment and the Ministry of Finance to work with relevant central ministries, agencies, and localities regarding tasks and budget estimates for the 2003 national target programs and the five-million-hectare forest planting project within their respective areas of responsibility.

Ministries and state agencies, according to their functions, based on calculations of exploitable resources, build socio-economic targets, propose solutions, new mechanisms and policies, or suggest amendments and supplements to existing policies as a basis for planning and budget estimates, and notify the Ministry of Planning and Investment, the Ministry of Finance, and related ministries and agencies before the budget estimate preparation period.

4. People's Committees of provinces and centrally-administered cities: guide, organize, and direct the Provincial Departments of Planning and Investment, Provincial Departments of Finance and Prices to closely cooperate with other departments and sectors in building economic and social development plans and state budget estimates for submission to competent authorities for decision.

The Prime Minister requests that ministers, heads of ministerial-level agencies, heads of agencies under the Government, and Chairmen of People's Committees of provinces and centrally-administered cities organize the implementation of this Directive effectively.