Positive year forecast for industrial production

HANOI, February 7 (VNA) - The industry and trade sector of Vietnam expects the index of industrial production (IIP) to grow to 6.3 percent this year as the world economy recovers, though slowly, helping boost exports. Restructuring will continue to be a priority this year, according to the Ministry of Industry and Trade (MoIT). Industrial production showed signs of recovery in 2013, with the IIP increasing by 5.9 percent and inventories decreasing. However, the macro-economy did not fully stabilise, consumers continued to budget carefully and free trade agreement negotiations remained unfinished. In addition, natural disasters and diseases presented a continued threat. Deputy Minister of Industry and Trade Le Duong Quang said that industrial production of Vietnam was still dependent on the world economy and thus vulnerable to global fluctuations. He added that technology remained low-level and the support industries did not receive adequate investment, meaning the country had to depend on imports for many raw materials. Nguyen Tien Vy, MoIT’s Director of Planning Department, said that the industry and trade sector would hasten restructuring, especially of State-owned enterprises, to enhance efficiency and competitiveness. He added that technology should play a bigger role in production and the localisation rate should be increased. According to the Vietnam Chamber of Commerce (VCCI), 42.5 percent of companies planned to expand business in 2014 while 50.7 percent would maintain the size of their businesses. This suggested that enterprises felt a better business year was coming in 2014, said Pham Thi Thu Hang, VCCI's General Secretary. Hang suggested enterprises improve their risk management capacity in order to take advantage of the Government's support policies. Chairman of the Vietnam Association of Mechanical Industry (VAMI) Nguyen Van Thu said that preferential capital sources should be made accessible to enterprises to help them boost production.-VNA