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The Government has set a target of reaching the inflation rate for 2010 at below 7%, approved by the National Assembly. Meanwhile, the coal prices have been allowed to raise, which will surely lead to the electricity price increases. The electricity price increases will be decided on March 1 ahead. Petrol prices also suddenly went up on Feb.21.

The prices of all goods expects to go up within the next three months when the electricity prices are raised following the last petrol price hike

Regarding the above-mentioned situation, Dr.Le Dang Doanh said: “This year the State expects to increase salaries and abrogate 2009’s tax exemption and reduction measures. Amidst the situation, I share the worry about inflation rate for 2010 that is likely to see an increase of over 7%. I hope the Government will deliberate on the price increase situation after Tet and if the electricity prices are raised in the period, prices in the market will go up.

According to you, which measures does the Government need to step up to curb inflation?

For me, the Government needs to cut costs and avoid excessive price increase for input products. The Government also needs to deliberate the adjustment of the exchange rate over the last three months before taking the following price increase measures.

What is your predication of Vietnam’s inflation rate for 2010?

I have not yet had enough foundation to predict Vietnam’s inflation rate for 2010 as there are some issues as follows: The International Monetary Fund (IMF) has raised its prediction level of the world crude oil prices from US$76/barrel to US$78.5/barrel this year. The world crude oil prices have also been raised. Along with crude oil, petrol, fertilizer, pesticide, …will see increase in prices. All input materials will consequently go up. Another thing is that credit policy have impact on the price increase level of Vietnam.

In terms of the exchange rate increase, according to the explanation of an official from the Vietnam Oil and Gas Corporation, the recent retail petrol increase in the domestic market may come from the exchange rate increase.

Reported by Nguyen Phuc-Translated by K.T