The production activities of businesses in 2023 have shown positive signs of recovery. Photo: T.D

Public investment - the main driving force for growth

Deputy Minister of Planning and Investment, Tran Quoc Phuong, evaluated that the results achieved in 2023 demonstrated the continuous efforts and relentless dedication of the political system throughout the past year. Statistical indicators showed that the domestic macroeconomy continued to be stable, inflation has been controlled at an appropriate level, and the supply and demand for essential goods have been ensured. Domestic purchasing and consumption activities were maintained at a reasonable growth rate. Specifically, Vietnam's Consumer Price Index (CPI) increased by about 3.25%, much lower than the 4.5% target set by the National Assembly.

"This was a significant success, laying a very important foundation for implementing other tasks and goals in the process of restructuring the economy, recovering and growing some key sectors. Alongside this, public investment was a bright spot. 2023 was a special year compared to previous years in terms of public investment. A massive capital of VND600 trillion was allocated, but disbursement was rapid, higher in the following month than the previous month, both in relative and absolute terms. By the end of December, the disbursement results reached over 81% of the plan assigned by the Prime Minister. If compared to the previous 11 months, in December alone, the last month of 2023, there was a significant leap, from 65% to 81%, an increase of 16%. If this pace is maintained in the settlement phase of January 2024, achieving a disbursement target of 95% is possible," said Deputy Minister Tran Quoc Phuong.

According to Dr. Nguyen Bich Lam, former General Director of the General Statistics Office, in 2023, public investment emerged as a significant driving force, playing a role in promoting, supporting, and compensating for other growth drivers. With a spirit of innovation and straightforwardly addressing existing issues in public investment capital disbursement, the Government and the Prime Minister have been determined, precise, and specific in directing the disbursement of public investment capital. Many key projects and inter-regional projects with spreading impacts were rapidly implemented. In 2023, for the first time, the disbursement of public investment capital achieved the highest result in scale, with VND625.3 trillion, reaching 85.3% of the annual plan, an increase of 21.2% compared to the previous year.

Especially in 2023, the number of newly registered private enterprises increased significantly. More than 200,000 enterprises joined the market nationwide, a 4.6% increase compared to the same period in 2022 and 1.3 times the number of enterprises that withdrew from the market in the past year. Among them, 160,000 newly established enterprises and nearly 59,000 enterprises returned to the market.

"We now have about 920,000 businesses. We expect that by 2024, Vietnam will reach the significant milestone of 1 million active businesses. This is also a very meaningful milestone," emphasized Deputy Minister Tran Quoc Phuong.

Economic growth mainly has relied on the "four-horse chariot"

According to Lam, the forecast for 2024 is that the growth of the world's leading economies, major trading partners of our country, will decrease compared to 2023. Some international financial and trade organizations appreciate Vietnam's fiscal and monetary policies for supporting the economy, and Vietnam has the potential to rank fourth in the world in high-tech exports. The openness of Vietnam's economy is large, and in 2024, economic growth will mainly rely on the "four-horse chariot," including innovation, ensuring consistency in institutional and legal environments for economic development; promoting domestic market consumption; efficiently implementing public investment capital, spreading to foreign investment; and promoting the export of goods and services.

Along with the four driving forces pushing Vietnam's economy forward, restructuring the economy; developing the digital economy, circular economy, and green growth; and participating more deeply in the global supply chain of some new industries and sectors such as semiconductors, high technology, and renewable energy are new drivers, becoming pillars for rapid and sustainable development of the economy in the coming time. In the context of the world economy declining, global trade fluctuating, and pessimism affecting the recovery and high growth of the industrial sector, domestic service consumption is still weak, making it difficult to promote the high growth of the service sector. Growth from public investment can only compensate for some other areas of the economy.

Deputy Minister Tran Quoc Phuong believed that in 2024, to achieve the economic growth target, functional agencies need to consider expanding or considering building new policies to promote growth. In the field of investment - a very important area, all three aspects: state investment, FDI investment, and private investment.

"In 2024, the National Assembly approved a public investment plan with a capital amount of about VND640,000 billion, lower than in 2023. With a lower capital amount, to bring about the impact of public investment on growth, it is necessary to demand from the early months of the year to pay attention to the disbursement work. I hope that the disbursement of public investment monthly, quarterly, at a minimum, must be equal to 2023," Deputy Minister Phuong expected.

To quickly disburse public investment capital, Lam believed that the Government needed solutions to promote the role, attach responsibility, and handle the responsibilities of the heads of ministries, agencies, and localities in disbursing public investment capital. The leaders must directly guide the resolution of difficulties, obstacles related to land, and resources. Simultaneously, urgently improving the capacity of investors, construction contractors, and construction. It is especially necessary to focus on addressing the issue of land clearance. The government should allocate land clearance as an independent project, implemented with specific regulations, suitable for actual conditions, to enhance readiness for project deployment. Compensation mechanisms and levels for land clearance must be fair, ensuring the rights and benefits of people when relocating, resettling for unanimous support during implementation.

The government needs to urgently grasp which sectors will become trends in the development of the world economy in the coming time, timely amend and supplement the Growth Strategy based on exports to integrate the Vietnamese economy into the mainstream, belonging to the pioneer group in some areas of the world economy.