VIETNAM 2005 HEALTH BUDGET ENVISAGES 17% SPENDING BOOST

The Vietnamese government has raised its healthcare budget for 2005 by 17% year-on-year, to VND12.6trn (US$802mn). Healthcare accounted for about 5.4% of the overall national budget in 2004.

Despite the increase, the government's action may be more reflective of recent drug price increases, rather than any expansion in procurement. The country's general consumer price index has risen by 30% since 1994, and by 6% in 2004 alone. Further, in recent years drug costs have increased sharply, despite government efforts to depress prices in the sector. However, public hostility to any further increases in drug prices is likely to undermine official attempts to control retail pharmacy prices and expand regulation.