Closely combining fiscal and monetary policies

The national fiscal policy aims to develop Vietnam into a strong country with wealthy people, said Minister of Finance, Vuong Dinh Hue.

On the sideline of the first session of the 13^th National Assembly, newly elected minister Hue granted an interview to the press on August 3 about the management of the fiscal and monetary policies.

Reporter: Could you tell us about the national financial policy in the next five years?

Minister Hue: Despite difficulties and challenges facing the world, including Vietnam, the next tenure will have its advantages.

Lessons drawn from difficulties and challenges during the process of inflation, financial crisis and economic downturn will be valuable experience for the management of the fiscal and monetary policies in the next five years.

The financial policy will focus on mobilising all resources for national socio-economic development and ensuring defence, security and social welfare. Proper allocation and effective use of these resources will help improve the efficiency of public spending.

The Government will mobilise all social resources, instead of depending on the State budget, to successfully implement the five-year plan, the 10-year development strategy and the three breakthroughs as the resolution of the 11^th National Party Congress pointed out and the Prime Minister has emphasized.

On the other hand, the Government will closely combine the fiscal policy with monetary policy as well as working with other ministries and departments to complete the socialist-oriented market economy. The financial policy targets of a strong country with wealthy people.

Reporter: Capital from banks has been tightened and interest rates remain high. Meanwhile the channel for capital circulation is the securities market. What is the ministry of finance’s opinion on the issue?

Minister Hue: Finance and credit is likened to the life-blood of the economy, so we must ensure that it circulates thoroughly in line with objective economic rules. Our task is to manage finance and credit which can meet the real demand. I do not like “tightened”. I like to use the word “close” to describe our fiscal and monetary policies.

Reporter: We now have many tax exemption policies for businesses, investors and low-income people. How will the policies be applied to help all subjects in the economy to overcome the current difficult period?

Minister Hue: When the economy faces crisis or downturn, the first measure to apply is the monetary policy. The fiscal policy will also be combined flexibly with the monetary policy.

The fiscal policy is considered a sweetener to reduce the “bitter pill” of the tightened monetary policy. It will combine with the monetary policy to help the economy avoid depression and quickly overcome the bottom of the downturn.

The upcoming tax exemption and reduction package that the Government will submit to the National Assembly will support businesses and workers with their difficulties.

Reporter: How will your past experience as the Chief Auditor help you in your new role as Minister of Finance?

Minister Hue: I think that the two agencies’ duties are different, but their aims are the same. Both of them target the building of a transparent national financial system with sustainable development.

I will use my experiences as the Chief Auditor in my new role and coordinate with the State Audit closely and effectively.

The audit sector has signed an agreement with the Ministry of Finance to build a transparent financial system with sustainable development. I and new Chief Auditor, Dinh Tien Dung, will strictly implement the agreement.

Reporter: Thank you very much!