Vietnam’s economic growth forecast to rebound strongly in 2022
Some foreign financial organisations have issued relatively positive predictions for Vietnam’s economy this year, with growth expected at 6.5 - 6.7 percent.
|A package factory of the HAPLAST Joint Stock Company in northern Hung Yen province (Photo: VNA)|
Standards Chartered held that the GDP growth will rebound strongly to 6.7 percent in 2022 and 7 percent in 2023, saying Vietnam’s medium-term outlook remains positive.
The bank made the forecast in its latest reports titled “Still battling headwinds” and “Vietnam - Moving back to high growth“.
“The economy should continue to bounce back in 2022 as the pandemic improves. Income growth has outpaced spending growth in recent years; this provides a decent savings buffer against the pandemic.” said Tim Leelahaphan, economist for Thailand and Vietnam at Standard Chartered.
“COVID-19 remains a key risk, at least in the short term. The first quarter could see a full resumption of factory operations, after closures in Q3/2021, and government stimulus; clearer recovery is expected in March,” he noted.
Economists at Standard Chartered said a continued improvement in the global trade environment will support exports in 2022 although import growth is likely to remain high.
In the recent “Vietnam at a glance” report, HSBC said after two years of growth slowdown, the country’s economic growth will accelerate to reach 6.5 percent in 2022. The Government also targeted this year’s GDP expansion at 6.5 - 7 percent, equivalent to the pre-pandemic levels.
It noted Vietnam has recovered steadily after hitting bottom in 2021 and that it will regain growth momentum in all aspects soon.
Manufacturing and export are expected to retain their leading positions, partly thanks to the stable commitments to foreign investment attraction. Besides, domestic demand is likely to bounce back further when current restrictions are gradually removed and the labour market revives.
HSBC noted the biggest obstacle needing attention now is the ongoing COVID-19 outbreak, especially the appearance of the Omicron variant, but it is encouraging that the vaccination has been much improved, enough for avoding another period of widespread social distancing.
Pandemic developments remain complicated. Hundreds of thousand of businesses faced difficulties in 2021 after resuming production after lockdown.
The digital economy in Vietnam accounts for about 8.2% of GDP. The development potential of the Internet and digital economy components is still quite large.