HANOI (AFP) — Vietnam’s annual inflation rate hit 27 percent in July, the government said Thursday, as rocketing food and fuel costs saddle its economy with one of Asia’s toughest battles against rising prices.
Yet experts warn the worst is still to come as this week’s hike in fuel prices takes its toll. August’s figures are expected to be much higher due to the impact of fuel prices.
Last Monday, Hanoi unexpectedly raised the petrol price by more than 30%, citing high costs in the world market. The decision was met by widespread public discontent.
Other official data Thursday estimated Vietnam’s trade deficit for the January-July period at 15 billion dollars as imports surged more than 50 percent.
The figures come after the Asian Development Bank on Tuesday warned Vietnam to take decisive measures to avoid the kind of economic meltdown suffered by Thailand in 1997, which triggered the Asian financial crisis.
Vietnam was once widely hailed as Asia’s next economic tiger, but has been battered by double-digit inflation, a ballooning trade gap, tumbling share prices and worries about the banking sector and its currency, the dong.
In July alone, food and beverage costs rose by 44.7 percent year-on-year, while the price of the staple food rice and other grains was up 72.7 percent, the state-run General Statistics Office said in a preliminary report.
Prices for housing and construction materials were up by 24.9 percent, clothing and footwear was up 10.9 percent and pharmaceuticals and health care costs rose by 9.5 percent for the month.
For the first seven months of the year, the consumer prices index has risen by 21.28 percent, the figures showed.
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Internantional Herald Tribune, 24 July 2008.
BBC, 24 July 2008.