HCM City’s contribution to state budget increases despite slower economic growth

09-Jul-2020 Intellasia | The Saigon Times | 6:02 AM Print This Post

HCM City’s contribution to the state budget has been increasing continuously over the past 20 years but its economic growth has slowed down compared to other localities, HCM City Party Committee Secretary Nguyen Thien Nhan said at a meeting this morning, July 7.

During the 2001-2010 period, HCM City contribution made up 26.5 percent of the nation’s state budget, which increased to 27.5 percent in the 2011-2019 period.

The city’s economic output accounted for 17 percent of the country’s total between 1996 and 2000, increasing to 20 percent from 2001 to 2010 and to 22 percent between 2011 and 2019.

The gross domestic product that HCM City generated on every one square kilometer in the 1996-2000 period was 27 times higher than the country’s average. This increased to 31 times and 35 times between 2001 and 2010 and 2011 and 2019, respectively.

“HCM City has been the country’s economic driver over the past 25 years, proved by both its GDP and contribution to the state budget,” Nhan noted.

However, the city’s economic growth rate decreased from 1.6 times higher than the country’s average in the 2001-2010 period to 1.2 times in the 2011-2019 period.

According to Nhan, the main reason for the city’s economic slowdown is that while its contribution to the state budget has been continuously increasing, its budget retention rate has dropped sharply.

Over the past 20 years, the budget retention rate of Hanoi increased from 30 percent to 35%, while Hai Phong City gets to retain 78 percent of its revenue. However, HCM City’s budget retention rate has fallen from 33 percent to 18%.



Category: Economy, Vietnam

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