Vietnam has weathered the global economic slump but growth has hit a 10-year low and there are many challenges before the nation is on a solid footing, the prime minister warned on Tuesday.
And he said there was still a problem of corruption within authorities while state firms were not run as well as they should be.
Gross domestic product (GDP) growth this year is projected to reach 5.2%, in line with a target of around 5 percent set by legislators, Nguyen Tan Dung said at the opening of a two-yearly National Assembly session.
“2009 GDP growth is the lowest in 10 years,” Dung said.
The Asian Development Bank (ADB) last month revised upwards Vietnam’s projected 2009 growth rate 0.2 percentage points to 4.7%, the second highest in Southeast Asia after Laos.
The last time the country saw growth that low was when it hit 5.8 percent after the Asian financial crisis in 1999.
The bank said Vietnam’s economic slowdown appears to have bottomed out and its growth is better than that of many other countries.
But despite signs of improvement, Dung said this has been “a year of difficulties and challenges”.
He said exports and tourism are down sharply, industrial output is recovering but remains at a low while there is “hoarding” of dollars and a balance of payments deficit estimated at 1.9 billion US dollars.
He also said there were risks of a return to high inflation.
“The economic structure is inefficient… The macro-economic balance is not solid,” Dung said.
“Corruption is still serious,” he said, and there are still many poor households.
He added that state assets and administrative apparatus are run inefficiently while there is also a shortage of skilled macro-economic managers.
For 2010, the government is targeting higher growth of about 6.5 percent with 7 percent inflation, a per capita income of about 1,200 US dollars, and fewer than 10 percent of households classed as poor, Dung said.