Vietnam raises GDP growth target to at least 8%, approves China rail link

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HANOI (Reuters) -Vietnam’s National Assembly on Wednesday approved raising the economic growth target for this year and also voted in favour of major infrastructure projects, including the country’s first nuclear power plants and a rail link to China. 

Lawmakers approved a new growth target for 2025 of at least 8% proposed by the government, an increase from the previous goal of 6.5% to 7.0%.

“With faster economic growth, macro stability must still be ensured while inflation must be kept under control,” the government said in a report to parliament. The report said inflation would be kept between 4.5% and 5.0% this year.

Parliament also passed a resolution supporting construction of a new railway linking a major seaport in northern Vietnam with China. The project is expected to cost $8.3 billion, part of which to be funded by loans from the Chinese government. 

Vietnam, a regional manufacturing hub heavily reliant on exports to drive its economy, has been seeking to ramp up infrastructure investment to boost growth. 

Lawmakers approved policies to develop nuclear power plants, the first of which is set to be built by the end of 2031. 

Under the policies, the government can appoint contractors to construct the plants without holding a tender process.

Parliament approved rules that would allow Elon Musk’s Starlink to provide satellite internet services in the country while maintaining full ownership of any local subsidiary.And a plan to offer financial support to local firms that enter the semiconductor industry was also supported.

On Tuesday, the assembly approved a bold bureaucratic reform plan that will slash up to a fifth of government bodies, as it tries to cut costs and improve administrative efficiency.    

(Reporting by Khanh Vu; Editing by Martin Petty and John Mair)