Illustrative image (Source: VNA)Hanoi (VNA) - The Ministry of Finance (MoF) has outlined threescenarios for inflation in 2018, with the consumer price index (CPI) in allcircumstances staying below 4 percent, the target set by the National Assembly.
In the first scenario, food prices are expected to remain relatively stable andonly rise slightly during the holidays.
Hikes in health care costs in the first quarter are projected to increase theCPI by 0.17 percent, while wage increases and higher power costs will drive upthe CPI by 0.14 percent and 0.1 percent respectively.
A 5 percent increase each in petrol and gas prices will lift the CPI by 0.28percent and 0.06 percent respectively.
After factoring in these price rises, the average CPI in 2018 is expected torise by 3 percent.
In the second scenario, which is largely the same as the first one, with theexception that pork prices rise by 7 percent at the end of the year and petroland gas prices increase by 10 percent, the average CPI in 2018 will rise by 3.4percent.
Meanwhile the average CPI will increase by 3.9 percent in the third scenario,assuming a 15 percent rise in pork prices and 15 percent hikes in petrol andgas prices with other price increases the same as in the first scenario.
According to the General Statistics Office (GSO), Vietnam’s average inflationin 2017 fell from 5.22 percent in January to 3.61 percent in November.
The year 2017 is considered a successful year in inflation control, as theaverage CPI increased 3.53 percent over 2016 and 2.6 per cent compared toDecember 2016, fulfilling the target of keeping the rate under 4 percent forthe whole year, GSO Nguyen Bich Lam said during a meeting last week.
Lam pointed out major reasons behind the CPI rise, including hikes in theprices of health care and education services, as well as an increase inregional minimum wage.
At the same time, domestic fuel prices in 2017 rose 15.49 percent compared to2016, contributing 0.64 percent in CPI increase for the whole year.
The price of construction materials was up 5.23 percent due to increases in theprices of sand and steel. Rising prices of essential goods in the global marketalso pushed the import price index up by 2.57 percent and export price index upby 2.93 percent; the Producer Price Index (PPI) expanded by 2.82 percent.
Lam underscored that a record number of 16 storms were seen in 2017, whichpushed up the prices of food and foodstuff in affected localities, especiallycentral provinces.
Meanwhile, there were a number of factors helping rein in inflation, includinga downturn of 2.6 percent in food prices in 2017, helping reduce the overallCPI by about 0.53 percent.
GSO Director Nguyen Bich Lam attributed the success in meeting the inflationtarget for the year to efforts of ministries in encouraging businesses’involvement in stocking goods and stabilising the market.
The Ministry of Finance had kept a close watch on market developments, whilecoordinating with the Ministry of Industry and Trade to manage fuel prices, hesaid.-VNA
VNA
