VINACHEM

PM Nguyen Xuan Phuc at MPI’s year-end summation conference last week again requested the General Statistics Office (GSO) to re-calculate GDP.

The request was made after analysts commented that GSO forgot the unofficial economic sector when collecting materials for GDP calculations.

“I want GSO to improve the GDP calculation method to find accurate figures about the size of the national economy,” Phuc said, adding that some analysts have said the value created by the unofficial economic sector was ‘forgotten’ when calculating the country’s GDP and that the value could be up to 30 percent of GDP.

“If Vietnam’s real GDP is 30 percent higher, the figure will be much higher than VND5,000 trillion, and the real public debt proportion will be smaller. If so, we can spend more money on investment and development,” Phuc said.

This was the second time Phuc asked to re-calculate GDP. The first request was at MOF’s (Ministry of Finance) review conference held two weeks ago.

At the conference, the PM explained the importance of GDP calculation, saying that if GDP value increases, the ratio of public debt on GDP will decrease.

“High public debt will threaten our finances. If GDP increases in the next years, this has great significance for us,” he said.

According to some members of the PM’s Advisory Council, the issue was mentioned several times by Deputy PM Vuong Dinh Hue at meetings.

On January 5, 2018, Hue signed a dispatch requesting MPI to accelerate the compilation of the plan on calculating unobserved economic sectors so as to find the figures which accurately reflect the status of the national economy.

The figures must include the value created by the underground, unofficial and self-sufficient economic sectors. The plan must be reported to the PM prior to January 30.

Meanwhile, at the MPI (Ministry of Planning & Investment) conference, MPI Minister Nguyen Chi Dung said his ministry has submitted to the PM the project on ‘strengthening state management over the quality of statistical work by 2030’ and the report on methods to calculate GDP’.

MPI has also submitted to the PM and Party Politburo a report with assessments about the resources of the Vietnam economy.

GSO’s general director Nguyen Bich Lam affirmed that the agency will re-calculate GDP on the basis of the 2016 Agriculture, Forestry and Fisheries Census and 2017 Economic Census.

A GSO report showed that in 2017, Vietnam had to pay VND239 trillion in principal and interest debt, which far exceeded the value of government bonds of VND160 trillion issued in the year.

According to MOF, it plans to seek VND363 trillion worth of capital from the public in 2018, of which VND206 trillion will be used to cover budget overexpenditures. - Source: ICIS -