Decision No. 20/2008/NQ-CP on continuing to implement measures to curb inflation, stabilize macroeconomic fundamentals, ensure social welfare, and achieve sustainable growth in the last months of 2008 based on the conclusion No. 25-KL/TW of the Politburo and the conclusion of the seventh plenary session of the Central Committee (Tenth Tenure).

RESOLUTION

Regarding the continued implementation of measures to control inflation, stabilize the macro-economy, ensure social welfare, and achieve sustainable growth in the last months of 2008 pursuant to Conclusion No. 25-KL/TW of the Politburo and the conclusions of the seventh session of the Central Committee of the Party (Tenth Tenure)

Implementing Conclusion No. 25-KL/TW dated August 5, 2008 of the Politburo and the conclusions of the seventh session of the Central Committee of the Party (Tenth Tenure) on the situation of socio-economic development in the first six months of 2008 and major solutions for the last six months of 2008, aiming to complete the socio-economic development targets for 2008 as best as possible, the Government has reached a consensus on evaluating the implementation of the first seven months of 2008 and setting out key tasks for the remaining months of 2008, specifically as follows:

I. EVALUATION OF THE SOCIO-ECONOMIC SITUATION IN THE FIRST SEVEN MONTHS OF 2008

In the first seven months of 2008, despite facing many difficulties and challenges due to global economic fluctuations and internal weaknesses of the economy, with the resolute efforts of the entire Party, people, and military to implement comprehensive measures to control inflation, stabilize the macro-economy, ensure social welfare, and achieve sustainable growth, the socio-economic situation of the country has shown positive changes.

Industrial production achieved a relatively high growth rate; the value of industrial production increased by 16.4% compared to the same period.

Agricultural production developed well. The area planted with rice nationwide reached 7.33 million hectares, increasing by 130 thousand hectares compared to 2007; the estimated harvest yield was 37.6 million tons, increasing by 1.7 million tons compared to 2007. The seafood production increased by 11.4% compared to the same period last year.

Export continued to achieve high growth rates; compared to the same period, export turnover increased by 37.7%; the market continued to expand. Import showed a declining trend; the trade deficit for the first seven months was at 15 billion USD, equivalent to 40.7% of export turnover.

The total retail sales of goods and service revenue increased by 29.8% compared to the same period.

Total state budget revenue reached 73.2% of the annual plan, increasing by 45.6% compared to the same period; state budget expenditure reached 62.4% of the annual plan, increasing by 29.1%, including investment development expenditure estimated to reach 56% of the annual plan, increasing by 13.5%; the fiscal deficit was equal to 18.3% of the projected full-year figure.

The tight monetary policy was effectively implemented, thus controlling the pace of increase in total means of payment and credit debt of the economy.

Total means of payment at the end of July 2008 increased at a low level, only increasing by 5.6% compared to December 31, 2007 (the same period last year increased by 22.2%). Exchange rate management was proactive and flexible according to the market and macroeconomic balance requirements.

Control and timely measures were taken to maintain stability in the financial and credit systems, ensuring the liquidity of credit institutions.

The stock market recently showed signs of recovery.

Consumer price index in July 2008 increased by 1.13% compared to June 2008, the lowest increase since the beginning of the year. However, compared to December 2007, it increased by 19.78%, still a high level.

State budget investment development capital implementation reached 48.6% of the annual plan, a lower level compared to the same period in 2007 despite significant increases in June and July. The disbursement progress was slow (only reaching 23% of the plan), especially for transportation, irrigation, health, and education projects funded by government bonds. The main reason was the delays in adjusting and supplementing project and construction cost estimates due to rising prices.

Foreign direct investment increased nearly fourfold, with actual implementation increasing by 42.9% compared to the same period. Disbursement from ODA funds was estimated to reach 63% of the annual plan.

Alongside controlling inflation and stabilizing the macro-economy, the Government directed ministries, sectors, and localities to urgently implement social welfare policies, support the livelihoods of poor and low-income people, particularly those affected by prolonged rain and floods in northern mountainous provinces recently, focusing on providing loans to poor people for production and credit for poor students.

Population growth rate control and quality improvement, food safety monitoring,... were strengthened and implemented more vigorously, resulting in some positive changes.

Traffic safety improved, the number of traffic accidents, deaths, and injuries decreased significantly compared to the same period in 2007.

National security and defense were maintained, social order and safety were ensured. The foreign affairs sector continued to achieve good results. In July, Vietnam successfully fulfilled its responsibilities as the President of the UN Security Council, receiving high praise from public opinion.

Information and propaganda work became more effective, providing fairly adequate and timely necessary information, aligned with the requirements of government guidance and management; strict handling of violations of laws in journalistic activities that had negative impacts on society.

Alongside the achievements made, the national economy still revealed some shortcomings and weaknesses. Although inflation was initially controlled, the trend of price increases over the past two months has slowed down compared to the early months of the year but the downward trend is not yet stable. The trade deficit has decreased but remains quite high. Interest rates remain high, affecting businesses' access to production and business capital, especially small and medium-sized enterprises. The review and reduction of public investment, and the savings in state budget spending have been delayed and have not been very effective. Implementation of social welfare policies in some localities has not been synchronized, procedures are complex, causing assistance to take longer to reach beneficiaries.

The global economic situation continues to be complicated, especially oil prices, the US dollar exchange rate, and the stability of some export markets for Vietnamese products,... will pose significant challenges in implementing socio-economic development tasks in the remaining months of 2008.

II. KEY TASKS TO BE IMPLEMENTED IN THE LAST MONTHS OF 2008

To implement the conclusions of the Politburo's Resolution No. 25-KL/TW and the Seventh Plenary Session of the Central Committee of the Party (Tenth Tenure) on the socio-economic situation in the first six months of 2008 and key solutions for the last six months of 2008, as well as Resolution No. 20/2008/QH12 of the National Assembly on some socio-economic issues in 2008 under new circumstances, the Government requests ministries, sectors, localities, economic groups, and state-owned corporations to continue to implement synchronously the contents and solutions for managing socio-economic activities in 2008 as stated in Resolution No. 02/2008/NQ-CP dated January 9, 2008, on major solutions to guide and manage the implementation of the socio-economic development plan and state budget estimate for 2008; Resolution No. 10/2008/NQ-CP dated April 17, 2008, on measures to control inflation, stabilize macroeconomic conditions, ensure social welfare, and achieve sustainable growth; particularly focusing on implementing resolutely the following key tasks and solutions:

1. Continue to implement measures to control inflation and stabilize macroeconomic conditions.

a) The State Bank of Vietnam shall proactively implement a tight but flexible monetary policy in management to continue controlling inflation while ensuring sustained economic growth at the planned level; manage interest rates in a positive real direction; flexibly manage exchange rates according to market signals; strengthen state management over foreign currency trading.

Closely monitor and supervise the operations of joint-stock commercial banks, especially those facing liquidity difficulties, to ensure healthy and stable development of the entire system.

In the third quarter of 2008, issue new regulations on criteria and conditions for establishing banks, raising requirements on capital scale, management capacity, and other technical conditions as a basis for reviewing and adjusting the operations of existing banks and granting licenses for new banks. Until new criteria and conditions for bank establishment are issued, temporarily refrain from issuing licenses for new banks.

Encourage and create favorable conditions for small banks to improve their operational quality or merge with other banks to form larger banks capable of developing in competitive and international integration environments.

b) Firmly implement measures to reduce expenditures of state agencies, units, and state enterprises.

The Ministry of Finance shall continue to direct and guide the implementation of measures to reduce expenditures in units using state budgets, strictly control regular expenses, particularly expenses for meetings and fuel usage; temporarily suspend purchases of new cars, equipment, and other high-value assets; strive to increase revenue and reduce state budget expenditure to decrease the budget deficit.

Ministries and localities, especially those directly managing large-budget projects and works such as Transportation, Construction, Agriculture and Rural Development, Defense, and cities like Hanoi and Ho Chi Minh City, shall continue to review and cut inefficient or unnecessary public investment projects to allocate funds to important and urgent projects that can be completed in 2008-2009, such as cement, electricity, road transport products, etc.; focus on directing the disbursement of investment funds for projects and works funded by the state budget; simultaneously expedite the approval of adjusted cost estimates and project adjustment budgets, linked to measures to mitigate losses caused by halting or delaying construction progress to accelerate progress and reduce waste.

c) The Ministry of Finance shall direct and closely monitor the operation of the securities market, promoting stable and healthy development, enhancing transparency and disclosure; promptly detect and address abnormal market developments.

2. Focus on implementing measures to boost exports, limit the trade deficit, and ensure supply-demand balance for essential goods, strengthen market management, and regulate prices.

a) The Ministry of Industry and Trade shall direct large groups and corporations to intensify exports of agricultural, forestry, fishery, and industrial products with high added value such as machinery, agricultural machinery, shipbuilding; promote processing activities in electronics, furniture, seafood industries, etc., to aim for a 26-30% increase in export turnover in the remaining months of the year; continue applying flexible customs and non-tariff measures (regarding standard control, quality, food safety, technical barriers, origin of imported goods) to control imports and ensure the trade deficit ratio for 2008 relative to export turnover remains around 30%.

The Ministry of Finance shall take the lead, coordinate with the Ministry of Industry and Trade and production groups to continue monitoring the implementation of policies to extend corporate income tax payment deadlines; exempt or reduce import duties on materials and raw materials for export processing to promptly address difficulties faced by export-oriented enterprises; instruct the customs sector to simplify administrative procedures to facilitate quick clearance of export goods.

b) Focus on domestic production combined with export-import management to ensure supply-demand balance for essential goods, particularly oil, foodstuffs, steel, fertilizers, medicines, etc., absolutely avoiding shortages in any situation; promptly resolve difficulties and obstacles in securing supplies for domestic consumption needs within authority or refer to higher authorities for resolution. The Ministry of Industry and Trade shall take the lead, coordinate with the Ministries of Agriculture and Rural Development, Construction, Health, and localities to immediately implement these contents.

c) Ministries, sectors, and localities shall, within their respective functions and duties, strengthen market management work, promptly detect and strictly handle speculative activities, unreasonable price increases aimed at illicit profits, spreading false information causing public panic, including revoking business licenses and prosecuting before the law serious violations.

d) Implement price control for gasoline and kerosene according to market principles, with the State not covering losses for these two items. The selling price will be adjusted based on ensuring business operations after minimizing costs to achieve reasonable prices, in accordance with the legal provisions on price declaration and registration. The Ministry of Finance shall take the lead and coordinate with the Ministry of Industry and Trade to proactively manage so that enterprises can adjust retail prices of gasoline and kerosene according to market principles while ensuring State control over these items.

For fuel oil prices, implement management towards approaching market principles, with the State gradually reducing loss coverage, moving towards applying management similar to gasoline and kerosene prices. For diesel, the State will continue to cover losses to support production in the short term; when conditions permit, market mechanisms will be applied.

The Ministry of Finance shall take the lead and coordinate with the Ministry of Industry and Trade to closely monitor global gasoline and kerosene market trends to proactively manage or propose appropriate measures to ensure harmony of interests between the State, enterprises, and consumers.

đ) Maintain stable selling prices until the end of 2008 for four items: electricity, clean water, public bus fares, and coal for four major consumer groups (electricity, fertilizers, cement, paper). For other items under the list of goods subject to price restraint policies, enterprises may adjust prices reasonably and in compliance with current regulations after implementing cost-saving measures to minimize adverse impacts on production and business activities; at the same time, strictly comply with legal provisions on price declaration, display, and registration.

3. Remove difficulties and obstacles to promote production and business activities:

a) The State Bank of Vietnam shall direct commercial banks to ensure sufficient capital for enterprises producing essential goods, export-oriented manufacturing enterprises (including foreign exchange balancing); adopt appropriate measures to meet the capital needs of small and medium-sized enterprises to maintain normal production and business operations.

b) The Ministry of Industry and Trade shall direct the Vietnam Electricity Corporation to apply measures to ensure adequate power supply for production, especially for essential goods and exports.

c) Ministries, sectors, and localities shall continue to vigorously reform administrative procedures, adopt appropriate measures to track, understand, and resolve difficulties and obstacles faced by production and business enterprises; proactively and resolutely eliminate outdated administrative procedures that hinder production and business activities.

d) The Ministry of Finance shall take the lead and coordinate with localities to inspect and immediately revoke illegal fees and charges.

đ) State-owned enterprises, particularly large corporations and holding companies, shall strictly review investment funds, minimize costs to enhance investment efficiency and competitiveness; play a core role in maintaining stable production and business operations, supplying sufficient goods, especially essential goods at reasonable and stable prices; continue to accelerate shareholding reforms and modernize state-owned enterprises in accordance with planned schedules.

e) The Ministry of Finance shall organize an assessment of the financial situation and operational effectiveness of economic corporations and state-owned holding companies, proposing policies and solutions to improve the operational efficiency of state-owned enterprises to play a core role in the economy. Quarterly, report comprehensively and accurately to the Prime Minister on the financial status of corporations, holding companies, and state-owned enterprises.

g) The Ministry of Planning and Investment shall urgently absorb, complete, and submit to the Government for promulgation a Decree on the formation, operation, and supervision of state-owned economic corporations.

4. Regarding social security:

a) Ministries, sectors, and localities shall, within their assigned responsibilities, focus on implementing social security policies already issued such as supporting distant sea fishing, providing kerosene subsidies for ethnic minorities, increasing social assistance levels, funding free medical examinations and treatments for children under six years old, raising scholarship levels for boarding students from ethnic minorities, supporting disease prevention, livestock, poultry, drought relief, purchasing rice seeds to restore production, addressing brown planthopper, yellow dwarf, and leaf curl diseases, accelerating the purchase of rice and agricultural products at reasonable profit prices for producers, supporting economic and social development in particularly difficult communes...; while promptly detecting and proactively resolving difficulties and obstacles to ensure that Party and State social security policies quickly reach beneficiaries.

b) Ministries of Labor, Invalids and Social Affairs, Finance, Agriculture and Rural Development, Health, Home Affairs, and the Committee for Ethnic Minorities shall actively implement or propose authorities with jurisdiction to supplement subsidy policies for new groups facing job loss, low income, retirees, civil servants; policies to assist people in areas heavily affected by floods; continue implementing poverty reduction programs.

c) The Ministry of Labor, Invalids and Social Affairs shall take the lead and coordinate with localities to grasp and compile information on job losses, reduced employment, and decreased income due to direct impacts of investment cuts and business reductions since the beginning of 2008; proactively study and propose appropriate solutions.

Focus on building and issuing support mechanisms and policies for poor districts; developing and issuing new poverty standards suitable for domestic and international economic and social conditions.

5. Ministries, sectors, and localities shall focus on implementing the regulations regarding information, proactively providing information, and closely coordinating with news agencies and press to ensure transparency and clarity of information about socio-economic conditions and central and local guidance measures, thereby meeting the public's information needs, reinforcing trust, and fostering social consensus.

The Ministry of Information and Communications shall continue to direct information agencies to accurately report and fully and promptly reflect the country's socio-economic situation, government policies, avoiding negative information that causes public anxiety and confusion; strictly handle violations in the field of journalism; promptly and effectively address false rumors that cause market instability and psychological distress; take the lead in developing a proposal for information and propaganda on the government's policies and measures to control inflation, stabilize macroeconomic conditions, ensure social welfare, and achieve sustainable growth.

III. IMPLEMENTATION

From now until the end of 2008, there is little time left while the tasks remain heavy, requiring significant resolve and effort from all levels, sectors, localities, and enterprises to best accomplish the socio-economic development goals for 2008.

1. Ministries, ministerial-level agencies, government-affiliated agencies, provincial People's Committees under the Central Government, state economic groups, and state corporations shall urgently implement this Resolution; report the implementation results to the Prime Minister before December 15, 2008, and simultaneously send them to the Ministry of Planning and Investment.

2. The Ministry of Planning and Investment shall compile the results of implementing this Resolution and report to the Government at its regular monthly meeting in December 2008./.