Prime Minister Nguyen Tan Dung has confirmed that the calculations of GDP for a number of localities in Vietnam are not accurate and need to be quickly corrected.
Prime Minister Nguyen Tan Dung
At the national conference on planning and investment held on August 7 in Danang City, Prime Minister Nguyen Tan Dung said that many localities reported that their annual GDP growth reached 9% or even 14%, while the national GDP growth was only 5%.
"The calculation of GDP for localities is obviously not accurate. In this context of global integration, we need to calculate the GDP in the standard way, even though it will result in lower numbers," he said.
Other delegates at the conference agreed that changing GDP calculation methods and planning new medium-term public investments are two key factors for Vietnam's development in the next five years.
The General Statistics Office will take over the job of calculating GDP for localities. This has to be done carefully because GDP figures are closely related with economic and social development plans that each province and city may design and implement.
Minister of Planning and Investment Bui Quang Vinh also gave his approval to the standardisation of GDP calculation methods nationwide. He said, "This is the solution to the paradox of why GDP figures at localities are much higher than the national GDP. If we don't change the methods we use, we'll have to bear the consequences, such as virtual economic growth and ill informed policy-making."
One of the examples was brought up was that many provinces and cities lying on borders, such as Quang Ninh, Lang Son and Danang, include all products exported at crossing points in their province to their GDP calculations even though the products did not originate from those provinces.
Meanwhile, the prime minister said that new public investment policies were proving to be efficient. The new policies strengthen investment efficiency as well as improve scattered investment and budget deficit problems, he noted.