Demand for essential goods to increase

Demand for 12 essential goods items is forecast to increase next year, including for steel, cement, oil products and coal.

Based on Vietnam 's economic growth expectations from 2011-15, the
Ministry of Industry and Trade estimated demand for steel products to
increase 8-10 percent to 12.5-12.8 million tonnes in 2011.

The demand for cement next year was predicted to go up by 10 percent to
55-56 million tonnes while total output to reach 60 million, thus
meeting demand and keep price stable.

Demand for petrol
and oil products was forecast to be 17 million tonnes next year, to be
met by 6 million tonnes of domestic production and 11.6 million tonnes
of imports.

The nation would balance the demand for 44 million tonnes of coal by producing 47.3 million tonnes, the ministry said.

Paper demand would increase to 2.35 million tonnes next year, to be met
by 1.77 million produced locally and 700,000 tonnes from imported.

The nation's consumption of 28 million tonnes of rice in next year
would be supplied by the expected harvest of 31.6 million tonnes.

The demand on medicine, food and fertiliser was also expected to increase next year.

Meanwhile, Prime Minister Nguyen Tan Dung has called on ministries,
agencies and municipal and provincial authorities to implement
strategies to stabilise the market and boost production.

Directive No1875/CT-TTg, released last week was designed to ensure the
country's growth rate reaches 6.5 percent, while the consumer price
index did not rise above 8 percent.

Dung said the economy,
which typically suffers during the final months of the year, would also
have to weather capital shortages, rises in the price of essential
goods, power shortages and potential animal epidemics/.

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Measures urged to stabilise prices

HA NOI — Prime Minister Nguyen Tan Dung has called for greater implementation of measures to stabilise prices in the final months of the year.

Directive No1875/CT-TTg, released on Monday, called on ministries, agencies and municipal and provincial authorities to implement strategies to stabilise the market and boost production, in accordance with Decree No18/NQ-CP, dated April 2010. The move is designed to ensure the country's growth rate reaches 6.5 per cent, while the consumer price index does not rise above 8 per cent.

According to the leader, the economy, which typically suffers during the final months of the year, will also have to weather capital shortages, rises in the price of essential goods, power shortages and potential animal epidemics.

The directive regulates that ministries of Industry and Trade, Agriculture and Rural Development, Health, and Construction should complete and release production-development plans, as well as strategies for distributing essential goods such as petrol and gas, fertiliser, building steel, cement, foodstuffs and medicines in the fourth quarter.

The Ministry of Industry and Trade should review production capacity and supply to ensure there are sufficient quantities of goods for production and consumption from now to the first quarter of 2011.

Finance Ministry agencies are required to enhance supervision of commodity prices – particularly medicines, milk products, building materials and gas, while stabilising the price of electricity and coal sold to the cement industry and fertilisers and paper producers.

The State Bank of Viet Nam should promulgate policies that allow commercial banks to quickly withdraw money from circulation to reduce price hikes. Meanwhile, food suppliers should ensure there is enough food, particularly in cities, industrial zones, populous areas and those vulnerable to natural disasters, the directive said. — VNS

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September inflation set for small rise

HA NOI — Inflation is unlikely to increase sharply in September despite some factors likely to exert upward pressure on the index.

Recent estimates indicated that the consumer price index (CPI) this month would record a month-on-month increase of one per cent.

However, official sources said that a CPI increase of one per cent was unlikely because price rises in some essential goods were less than previously estimated.

The Ministry of Industry and Trade's Domestic Market Management Team expected September's CPI to increase by just 0.3-0.4 per cent against August.

Crude oil registered a slight reduction, but many other essential goods continued to increase in price, including sugar, fertiliser, food and catering services, animal feed, milk, medicines, consumer goods and steel ingots.

So far this month, rice prices had increased by VND1,000 per kilo in the first week but saw a slight reduction of VND200-300 per kilo in the second week.

With the onset of the rainy season, food prices would increase in some places which had experienced heavy rain, storms and flood, said the team.

An increase in the interbank rate early this month had also pushed prices of imported products up, so a future rise in the CPI could be possible.

The new school year started in September, and increased school fees saw educational products and related services rise.

However, the prices would have little effect on the CPI because this spending accounted for only 5.72 per cent of total household expenditure, constituting the CPI.

Meanwhile, recent sharp increases in the price of gold and US dollar would not affect the CPI this month, as the index excluded the prices of those products, the team said.

The team believed many factors would lead to an increased CPI, but the rise would not be sharp due to the Government's effective policies on curbing inflation. — VNS

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