Containers being loaded at Tan Cang - Cat Lai Port in HCM City.

Obstacles regarding interest rate support should be removed so that enterprises, cooperatives and households can access capital soon, she said in an interview with Vietnam News Agency on measures that Vietnam should adopt in response to risks from the decline of the global economy.

The implementation of monetary policy should be conducted in a cautious, proactive and flexible manner to ensure interest rate stability as well as to support the economy and stabilise the exchange rate.

Priority should be given to fiscal policy and expanded. Taxes and fees need to be reviewed to provide the best support for businesses to resume production and economic growth.

Measures to control prices, as well as inflation, should be taken to ensure inflation is kept below 4%, Van said.

It is essential for Vietnam to enhance production capacity and build an independent and resilient economy, she said, adding that this orientation will help Vietnam become less dependent on external sources while minimising damage caused by disruptions in global supply chains and from China’s “Zero Covid” policy.

Given the fact that major economies face the risk of recession, Vietnam must anticipate the challenges that might arise including imported inflation, she noted.

Vietnam could suffer exchange rate fluctuations as the US and Europe hike interest rates which will have an impact on the world financial market.

The State Bank of Vietnam has recently intervened in the foreign exchange market to stabilise the exchange rate, so foreign exchange reserves will be reduced, she said, adding that this is also a challenge.

According to Van, the adjustment of regulatory interest rates by the SBV aims to narrow the gap between the Vietnamese dong and US dollar, thereby stabilising the exchange rate.

However, it also has an impact on the national economy. An increased interest rate will raise the input costs of enterprises, reducing the need for loans to expand production, thereby affecting the growth potential of the economy, she said./