Vietnam Government Sets Directions for Fiscal and Monetary Policies

Strategic Insights -

The Prime Minister of Vietnam, Pham Minh Chinh, has issued an Official Dispatch setting forth directions for the coordination of fiscal and monetary policies. The document, dated September 7, aims to sustain macroeconomic stability while driving economic growth to achieve the 2025 GDP growth target of 8.3-8.5%. The Government emphasizes the need for prudent yet targeted expansion of fiscal measures, with a focus on tax policy reform, digital transformation, and stricter enforcement. The document also calls for urgent progress in public investment disbursement, streamlining procedures to bolster production and employment, and encourages foreign direct investment in large-scale, high-tech projects.

Key Takeaways:

  • The Government aims to increase 2025 State budget revenue by at least 25% over estimates, with a focus on tax policy reform and digital transformation.
  • Regular expenditures will be tightly controlled, with unnecessary spending decisively curtailed.
  • Policies on tax relief, fee reductions, and land rent deferrals will continue to support businesses and households.
  • The goal is to reach at least 60% disbursement of 2025 public investment capital by the end of the third quarter and 100% by the year-end.
  • The Government encourages foreign direct investment in large-scale, high-tech projects, particularly in sectors such as transport, energy, and education.
  • State-owned economic groups and corporations are expected to take a leading role in national development, improving governance and operational efficiency.
  • The State Bank of Vietnam is directed to manage monetary policy in a proactive, flexible, and timely manner, closely aligned with fiscal and macroeconomic strategies.

Statistics:

  • 8.3-8.5%: the target GDP growth rate for 2025.
  • 25%: the increase in 2025 State budget revenue over estimates.
  • 60%: the disbursement target for 2025 public investment capital by the end of the third quarter.
  • 100%: the disbursement target for 2025 public investment capital by the year-end.
  • 2026: the year in which the credit growth quota mechanism is expected to be phased out.

Sources:

  • "Official Dispatch of Prime Minister Pham Minh Chinh on directions for coordination of fiscal and monetary policies". Vietnam News Agency, September 8.