Inflation target in 2017 is set at fourpct

27-Dec-2016 Intellasia | VnEconomy | 6:00 AM Print This Post

At the meeting of the Steering Committee on Price Management on December 22nd, deputy prime minister Vuong Dinh Hue said the government will complete the target to control inflation below five percent in 2016, because according to the report of the general Statistical Office, although in the recent time the petrol prices has recorded the biggest increase since the beginning of the year, the Consumer Price Index (CPI) was just 4.5 percent by the end of November 2016. Thus, the CPI target in 2016 is expected to be completed.

According to deputy prime minister Hue, this is the result of government’s efforts in the context when there are various difficulties in the economy and society, numerous factors putting pressure on inflation when the ministries adjusted the prices of public services such as medical and educational services, strong increase of petrol prices in the end of the year, and the continuous droughts, saltwater intrusions and flooding, etc.

According to the Resolution of the National Assembly, in 2017, the inflation is expected to rise by an average of about four percent. However, deputy prime minister Hue believed that there are many challenges to complete this target as the prices of many commodities have reached the bottom levels and tended to rise again, while 27 cities and provinces will increase hospital expenses and series of public services will switch to price mechanism.

Particularly, the world oil price is forecasted to continue to rise in the first quarter of 2017, being around 65-70 US dollars per barrel in 2017, up by about nine to 15 percent compared to 2016. The developments of disaster are said to always have high risks on creating pressure on the price levels.

To successfully control inflation, deputy minister Hue requested the Ministry of Industry and Trade to closely monitor the world oil prices, and flexibly operate and effectively use the Petroleum stabilisation fund; complete the retail electricity pricing frame based on the calculation of input and output values of production activities, carry out trading of electricity, and choose reasonable time to increase electricity prices.

Regarding prices of medical services, the Ministry of Health should continue to carry out the roadmap under Joint Circular 37 applicable for 27 remaining provinces and cities; and soon issue price guiding for medical services to the people not having health insurance card.

The deputy prime minister assigned the Ministry of Health to quickly complete the legal framework on the management of drug prices, conduct bidding for the medicine prices of the Ministry of Health and the medicine prices serving medical services with health insurance in order to reduce the medicine prices by 10-15 percent; and strengthen the management of medicine prices.

Deputy prime minister Hue said that the lowering medicine prices through bidding channel and reducing build-operate-transfer (BOT) fees of transport sector in 2017 will create favourable conditions for the government’s administration and inflation control. In addition, the transport sector should promote multimodal transport to reduce road freight and strictly control traffic charges at ports.

The Ministry of Education and Trading is tasked to collaborate with the Ministry of Finance on closely monitoring the increase of educational materials and services. Meanwhile, the Ministry of Finance and Ministry of Industry and Trade are assigned to strictly carry out the control on milk prices, especially in the first quarter of 2017.

Furthermore, deputy prime minister Hue requested the People’s Committee of provinces and cities to enhance the management of commodities in terms of prices, especially during Christmas, New Year, Lunar New Year periods, in order to not let the lack of goods lead to price fever.

 


Category: Economy

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