Vietnam’s gross domestic product (GDP) will likely to grow 6.5 percent and 6.6 percent in 2015 and 2016, respectively, according to the latest Asian development outlook report released by the Asian Development Bank (ADB) on September 22 in Hanoi.
Aaron Batten, the ADB’s Country Economist and also one of the report’s authors, said the ADB identified three key drivers of the higher economic growth in Vietnam.
ADB press conference to release the Asian development outlook 2015__Photo: cand.com.vn
First, foreign direct investment disbursement reached a record level in the first half of this year, helping boost manufacture and export.
Second, consumer spending was rising, thus lifting retail sales, while credit growth also exceeded the targets.
The third driver was the Government’s pro-growth monetary and fiscal policies.
According to the ADB, the economic growth was supported by low inflation while the Government’s policies had been aided by lower global commodity prices.
However, the report also named challenges facing the Vietnam’s economy.
Slowing economic growth in China, one of Vietnam’s largest trade and investment partners, might dampen trade prospects while continued low global commodity prices would reduce export earnings for key sectors like oil and agriculture.
Surging imports together with lower oil revenues were leading to deterioration in the current account surplus, and the El Nino weather system was predicted to reduce the agricultural output in 2016, the report said.
“To mitigate these challenges, it will be vital for the country to further reform the financial sector, increase productivity and boost international competitiveness,” said Eric Sidgwick, ADB Country Director for Vietnam.- (VNS/VLLF)