Economy climbs higher

Expanding production and consumption are driving the economy forward -Photo: Le Toan

The World Bank in Vietnam released its East Asia and Pacific Economic Update last week, highlighting Vietnam’s expected growth of 6.2 per cent in 2015 and 6.3 per cent in 2016, while the rest of developing East Asia was expected to grow only 4.5 per cent this year.

“Among the large developing ASEAN economies, growth conditions are expected to be most buoyant in the Philippines and Vietnam. In Vietnam, a mix of investment and consumption demand growth, amidst strong export sector performance, is expected to sustain economic expansion,” said the report.

Early this month, HSBC also raised its 2015 GDP forecast for Vietnam to 6.6 per cent, from 6.3 per cent previously. It also lifted its 2016 GDP forecast to 6.7 per cent, from 6.5 per cent earlier.

“Domestic demand has been gradually revived, led by stronger activity in the construction industry. This is also reflected in credit growth, which is expected to run above target in 2015,” said the bank’s economist Izumi Devalier.

Not only the World Bank and HSBC, but also the Asian Development Bank (ADB) lifted its forecast in late September for Vietnam’s GDP growth, to 6.5 per cent in 2015 and 6.6 per cent in 2016. This forecast was revised from ADB’s original forecast earlier this year that the GDP would likely grow 6.1 per cent for 2015 and 6.2 per cent for 2016.

“Vietnam is gaining growth momentum. Its expected growth rates of 6.2 per cent in 2015 and 6.3 per cent in 2016 are very positive compared to many other economies suffering from bigger difficulties,” said the World Bank’s lead economist Sandeep Mahajan. “All economic indicators have reflected that.”

The economy grew 6.81 per cent in this year’s third quarter, up from 6.15 per cent in the second quarter and 6.03 per cent in the first quarter. The nine-month growth rate is 6.5 per cent.

The government reported that the industrial sector had become the growth’s key driver. It climbed 9.57 per cent in this year’s first nine months on year.

In this year’s first nine months, Vietnam saw nearly 68,350 newly established enterprises, with total registered capital of $19.76 billion, up 28.5 per cent in the number of enterprises and 31.4 per cent in capital.