Glowing reports from 8th MB Economic Insights

The main topic of this 8th MB Economic Insights was Financial Optimisation ahead of Diversification Challenges

The annual 8^th MB Economic Insight 2022, organised by MB at the Sheraton Hotel in Ho Chi Minh City, presented emerging perspectives on the present volatile socioeconomic environment. The event is a prestigious annual seminar for leading economists to share their opinions about current issues and search for effective solutions.

More than 350 experts and entrepreneurs with active export and import businesses attended the conference to exchange their perspectives on optimal financial planning.

Francois Painchaud, representative from the International Monetary Fund (IMF) in Vietnam and Laos, attended this conference presenting the topic Sailing into the Headwinds, where he praised the Vietnamese government for its prompt removal of COVID-19 restrictions.

Manufacturing, retail, travel, and tourism industries have all seen a significant rebound since the beginning of the year, thanks in large part to the continued strength of external demand and the positive effects of the Program for Economic Recovery and Development.

“Built-up demand and a robust recovery in the labour market have contributed to the ongoing growth of consumer spending,” he observed.

“Notwithstanding this, there are some challenging drivers that could trigger a slowdown in global economic growth. In addition, the increasing inflationary pressure is also one of the biggest concerns for both international and domestic economies,” he added.

In response to these challenges, the IMF representative advised Vietnam to carefully calibrate, modify, and coordinate its policies, with a particular emphasis on keeping inflation under control and making creative use of fiscal policies.

Meanwhile, senior lecturer and economist from Fulbright University of Public Policy Nguyen Xuan Thanh elaborated that the Vietnamese economy still has significant growth potential from the domestic market even though international fluctuations are causing unpredictable forecasts. The primary emphasis must be that inflation remains under control and that the government still has sufficient budgetary headroom to boost the domestic economy via expenditure decisions.

“If implementation efficiency and disbursement speed can be improved, public investment will be the biggest key driver for economic growth during the 2023-2025 period,” Thanh emphasised.

However, in the short term, interest rate hikes, fluctuations in foreign exchange rates, and geopolitical instability will continue to exert pressure on the domestic economic climate.

If major advanced countries endure a recession in 2023, Vietnam's export efforts, notably in the European and American markets, are likely to encounter severe obstacles.

Maintaining macroeconomic stability requires a cautious approach to monetary policy. As liquidity on the money market has decreased at the end of the year, interest rates will stay elevated. Up to mid-November, the VND depreciated by 8.7 per cent against the dollar, but this depreciation figure still pales in comparison with other regional currencies.

According to Thanh’s prediction, the 2023 GDP growth target of 6.5 per cent is quite ambitious and the inflation target has been revised up to 4.5 per cent from 4.0 per cent.

“In case of an unexpectedly high interest rate in 2023, the economic growth target will be difficult to achieve,” he said.

“If the Fed adjusts its quantitative tightening programme, which would affect inflationary and exchange rate pressures, Vietnam's monetary policy could be actively redirected to support growth by mid-2023,” Thanh concluded.

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Seminar participant Tran Mau Huy from the firm Hao Hung shared that he had been attending the MB Economic Insights series ever since it began.

“I have found great practical use for the seminar's economic and financial insights and solutions in areas like goal setting and projections for the following year,” he said.

This year’s MB Economic Insights conference was widely regarded as cutting edge, immediately applicable, and profoundly remarkable in the backdrop of the global uncertainties that are presenting various threats to both supply and demand.

MB Economic Insights is an annual conference held by MB Group to provide economic and financial information and forecasts to help customers navigate their management activities, conduct their business plans, and search for solutions to any issues they are experiencing. The conference also aims to connect export companies in different sectors. This year is the first time that the conference has applied digital technology to create a real-time, interactive seminar.

28 years of MB’s customer-centric philosophy After 28 years, MB has successfully evolved from a commercial bank with just 25 employees and $870,000 of charter capital into a versatile financial organisation that is rapidly embracing digital transformation in order to provide its clients with the finest experience.

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