Deputy Prime Minister Vuong Dinh Hue has affirmed the Government’s resolve to keep inflation at between 4-5 percent for the whole year following consecutive consumer price index (CPI) increases in the period from January to May.

According to the General Statistics Office (GSO), the CPI in May rose 0.54 percent against the previous month and 2.28 percent against the same period last year. For the whole five months, the CPI has upped 1.88 percent.

Deputy Prime Minister Vuong Dinh Hue

The agency said the CPI hike in May is the highest in the past five years, caused by the simultaneous price increase in 11 groups of goods from the previous month.

Talking with the press, Deputy PM Hue said 2016 saw several factors that can push up the CPI, including rising oil prices and the upward revision of some public services such as education. The ongoing drought and saline intrusion has also pushed the prices of agricultural products higher.

At a recent meeting of the Price Steering Committee, the Deputy PM urged more rapid and accurate forecast and analysis as well as closer coordination of sectors and fiscal and monetary policies in order to contain the CPI rise below five percent.

The Deputy PM asked relevant ministries and agencies to finalize and issue documents on price management within their realm of responsibility.

For some essential goods like oil and petrol, the Deputy PM asked the Ministry of Industry and Trade to work with the Ministry of Finance to review the use of the average import tax in petrol price calculation and recommend adjustments; build a roadmap for adjusting oil and petrol prices and assess their impacts on the CPI.

On electricity price, the MoIT instructed the Electricity of Vietnam group to report to the PM on production costs, selling prices, profit and loss, and the market-based management of electricity prices. The group is also requested to draw up price scenarios for 2017.

Deputy PM Hue also said strict control will be imposed on medicine prices, which have increased 20.84 percent on average against 2015, and 28.26 percent against 2014.

The government assigned the Ministry of Education and Training to calculate tuition fees for the 2016-2017 school year.

Concerning fees for using Build-Operation-Transfer (BOT) transport works, the Deputy PM said investing in transport infrastructure in the form of Build-Operation-Transfer (BOT) or Public-Private Partnership is inevitable, but the investment must be done in a transparent manner. The government agreed with the MoT not to increase BOT charges at the moment, to ease pressure on the CPI.

The State Bank of Vietnam also have to devise scenarios on running monetary policies to ensure the increase of inflation does not exceed five percent in 2016.

Source: VNA