Vietnam plans $6 billion stimulus package

Vietnam plans $6 billion stimulus package

Hanoi: Vietnam says it will increase a previously announced billion-dollar economic stimulus package to almost six billion dollars, state media reported Monday.

The package, to be unveiled later this month aims to revive the slowing economy with tax cuts as well as spending on infrastructure, housing, schools and hospitals, Deputy Prime Minister Nguyen Sinh Hung said Sunday.

The announcement comes after Prime Minster Nguyen Tan Dung said the government would provide a billion dollars to boost the export-led economy amid the global financial crisis.

Small and medium-sized enterprises would be offered tax breaks and deferred tax payments, and they would be given better access to bank loans, Hung told the Vietnam Young Entrepreneurs’ Organisation congress.

The International Monetary Fund has forecast economic growth of 5% in Vietnam next year, while the World Bank has predicted a rate of about 6.5%, in line with Vietnam’s official target.

“We must act now to boost production, consumption and maintain economic growth of 6.0-6.5% in 2009," Hung was quoted as saying.

Vietnam’s economy grew by 8.5% in 2007.

Hung gave no details on the stimulus package or its release date, or from what government funds the money would be drawn, reports said.

“The government will announce this package after the government’s meeting at the end of December. We will announce how to make the package most efficient to avoid losses and waste," he said.