Vietnam’s economy has recorded notable achievements year to date. However, maintaining the country’s economic growth momentum may be challenging next year, according to economic expert Vo Tri Thanh.
Vo Tri Thanh, former vice president of the Central Institute for Economic Management, speaks at a seminar, held on November 5 in HCMC, discussing whether Vietnam’s economy will advance or slow down in the next decade
Thanh released the forecast at a seminar, held on November 5 in HCMC, discussing whether Vietnam’s economy would advance or slow down in the next decade.
Data from Rong Viet Securities indicate that the country’s gross domestic product (GDP) growth in the first nine months of the year is expected to reach US$265 billion, completing 81% of the target figure.
At a recent session of the National Assembly, the prime minister noted in a report that the 2019 GDP growth rate may exceed 6.8%, though the third quarter’s GDP growth reached a 10-year high of 7.31%. The growth during the rest of the year will depend on the disbursement of foreign direct investment (FDI) capital, said Thanh.
The Government has set a GDP growth target of a mere 6.8% for next year, while figures predicted by other organizations are between 6.9% and 7.08%. That means some obstacles are foreseen for the year to come, according to Thanh.
Vietnam has staged an outstanding performance in terms of its economy, but reaching the GDP target of 7% will be a tall order, the economic expert added.
Vietnam’s manufacturing Purchasing Managers' Index (PMI) in September fell to 50.5 points. The country saw sluggish growth in new orders by the end of the third quarter, especially in the number of textile and garment orders.
A report from an SSI brokerage firm revealed that many manufacturing sectors had slowed down in the first 10 months of the year, even though the manufacturing PMI had moved sideways thanks to an improvement in the electronics industry.
The country’s export turnover in October dipped 0.8% compared with last year’s figure, marking the first fall over the past eight months. Of this, outbound sales of FDI firms dropped by 5.5%.
In addition, the export revenue of agro products such as coffee, pepper, vegetables and aquatic items inched down. The group of aquatic products encountered the steepest fall over the past four months, of 13%.
Many organizations predicted the global economy would continue its slowdown until the end of 2020, considerably affecting local economic growth. The downswing may pose risks for the country’s export activities, said Thanh. SGT
Though they are optimistic about the economic performance in the first nine months of the year, economists still warn that in the long term,m Vietnam’s economy may be influenced by a global recession.
Vietnam’s GDP rose by 7.31% in the third quarter of this year, contributing to raising the nine-month GDP to the highest level over the past nine years, signaling that Vietnam's economy can make a breakthrough.