How to curb growing trade gap

With fear growing of a trade deficit in the first two months of this year, Industry and Trade Deputy Minister Nguyen Thanh Bien spoke with Thoi bao Ngan hang (Banking Times) about measures to curb the widening trade gap

The trade deficit recorded in the first two months of this year amounted to 19.6 per cent of the export turnover. Will it be possible to maintain a trade gap of less than 20 per cent for the whole year?

We are endeavouring to achieve the Government's target. The reason the trade deficit reached nearly 20 per cent in the first two months, was partially because products such as rare stones and metals were not exported as much as in previous years. On contrary, the country had to import a significant quantity of these products to stabilise the local market. I think the matter will not be as tense in the coming months.

The Prime Minister has assigned the Ministry of Industry and Trade to develop this year's export development policy. Which issues and group of products will be prioritised?

Presently, the ministry is actively implementing measures to prevent the price of some agricultural products from plunging to a level that may cause farmers and businesses to suffer losses.

It has also already worked with the Viet Nam Food Association and Cuu Long (Mekong) delta provinces to purchase 1 million tonnes of rice for farmers, so rice prices will not drop lower than their current prices.

The ministry is also working with the Ministry of Agriculture and Rural Development to buy coffee from farmers, so the coffee price will remain stable and not drop as it did last year.

How will measures to control imports be implemented?

A series of measures have been adopted to cut imports but they lack co-ordination between ministries and sectors. The matter will be fixed in the coming time.

For example, regulations on food quarantine will be applied when importing meat products, processed foodstuffs, poultry, and fruit to ensure food safety for consumers.

Of course, careful consideration must be made before applying any technical barriers because it will adversely affect domestic products. We are not allowed to discriminate between imported and domestically produced products. But we must implement measures pursuant to the law and in conformity with the country's ability.

A proposal on "export credit insurance" is in the pipeline. Will the proposal violate WTO rules when implemented?

In no way does it break WTO rules. Both developed and developing countries have applied it for years. The Ministries of Finance, Industry and Trade have already studied experiences from countries which have implemented the policy. The project is expected to be submitted to the Government for consideration and approval in the first quarter of this year. — VNS