VINACHEM

Do Hoang Anh Tuan, deputy minister of finance, said reduction in the world crude price to US$36 per barrel in future transactions would not affect budget revenue this year.

The budget revenue this year has exceeded the target to reach between VND65 trillion and VND66 trillion ($2.9 billion), including 6 per cent from tax revenue of the crude oil exports, he said. The tax revenue from the crude oil exports at present does not account for a large segment of the total tax revenue unlike five to ten years earlier.

The finance ministry has forecast economic development for each case that the crude oil price is $60, $50, $45, or $40 or even $35, or $30 per barrel, he said.

In 2016, Viet Nam would import 12.5 million tonnes to 13 million tonnes of petrol and oil and if the world crude oil price still remains at $36 per barrel, the nation would save between $2 billion and $2.1 billion.

The reduction in oil prices would bring down the input price of production, so production and business of enterprises and people would improve, leading to an increase in the tax revenue from the local economy, Tuan said.

Luong Van Khoi, head of the World Economic Department under the Ministryof Planning and Investment's National Centre for Socio-Economic Information and Forecast, said the government and the State Bank of Viet Nam should follow closely the fluctuation of the world crude oil price and policies in countries which are Viet Nam's biggest trading partners and ensure a reasonable adjustment for exchange rate.

They should also tighten monetary policies to promote economic growth, reduce the petrol price in the local market to enhance production growth and reform the tax system to ensure tax revenue or offset lower tax revenue due to reduction of world oil prices.

Viet Nam would also promote restructuring of its economy, including institution reforms for creating favourable conditions for economic growth. — VNS