As the country recovers from the Covid-19 outbreak, Vietnamese Prime Minister Pham Minh Chinh is confident that Vietnam’s economic growth this 12 months will exceed forecasts and permit it to proceed to retain its title as Southeast Asia’s fastest-growing economy next 12 months.
Defying the federal government’s goal of 6-6.5% and faster than the median 7.3% predicted in a Bloomberg survey, it projects gross domestic product to grow 8% in 2022 and 6.5% the next 12 months.
Given the many obstacles and issues facing the economy amid a deteriorating global outlook, Chinh described the 2023 forecast as “realistic” in a press release prepared firstly of the National Assembly’s fall session. He said the upper base created by this 12 months’s GDP data will hamper growth next 12 months.
The country’s traditionally large export markets have “narrowed” while the economy “faces various headwinds, with significant inflationary pressures, dramatic changes in oil prices and rising input costs,” Chinh told lawmakers.
The prime minister’s annual speech, delivered amid economic recovery efforts after last 12 months’s virus lockdowns that led to factory closures and disruptions to global supply chains, charts the economic course for the approaching 12 months. As a results of the lifting of restrictions, growing domestic demand and better exports, the economy has recovered.
He said that for the rest of 2022 and next 12 months, the federal government “will proceed to prioritize curbing inflation while supporting economic growth.”
As the federal government tried to strike a balance between containing inflation, protecting households from the results of increased living expenses and maintaining the momentum of economic recovery, Vietnam recorded double-digit growth within the third quarter.
Even after implementing a rare tightening of monetary policy last month together with rising rates of interest to combat inflation and support the currency, the central bank is asking business banks to search out ways to maintain borrowing costs low.
According to Chinh, the federal government “will pursue policies that can assist economic recovery, but may also remain vigilant against the danger of triggering inflation.” He continued: “The government will fastidiously regulate lending to potentially problematic regions, while also aiming to take care of an adequate money supply for businesses.
The government forecasts that inflation in 2023 will amount to 4.5% in comparison with 4% this 12 months.
Additionally, the International Monetary Fund (IMF) recently raised Vietnam’s economic growth forecast for this 12 months from 6% to 7%, the one major upward revision amongst major Asian countries. This represents a rise of a full percentage point in comparison with three months earlier.
The IMF revised down its 2023 forecast by 0.5 percentage points to six.7 percent, although this still stands out from other weakening forecasts and would represent the fastest growth amongst large Asian countries.
Source: BangkokPost.com, IMF.org
