Rosy 2017 Vietnam economic outlook: experts

Export potentials 08:34 16/01/2017
Vietnam will achieve its 2017 goal of 6.7 percent growth in gross domestic product (GDP), higher than 6.21 percent in 2016, due to the efficiency of its reforms, say experts.

The National Financial Supervisory Commission of Vietnam (NFSC) says this year, Vietnam’s economy will improve due to the reform of institutions and of the investment environment, as well as the price recovery of energy and farming products on the world market, creating new impetus for the private sector.

Meanwhile, the World Bank (WB) and Asia Development Bank (ADB) have forecast that Vietnam’s GDP growth will reach 6.3 percent for this year, and the International Monetary Fund (IMF) set that figure at 6.2 percent.

The National Centre for Socio-economic Information and Forecast (NCIF) under the Ministry of Planning and Investment has two scenarios for domestic economic development this year based on the impact of the Government’s directions and an IMF forecast of global GDP growth of 3.4 percent.

According to the more likely first scenario, the domestic economy will remain stable and development and local investment will keep improving. Vietnam will benefit from its global integration to improve exports and investment. That would translate into 6.44 percent GDP growth and inflation of 5 percent in 2017.

The second scenario foresees 6.72 percent GDP growth and inflation of 6 percent if it further improves the structure and efficiency of the economy.

Policy management as well as legal and investment environment reforms in 2016 have begun to have an effect, the NCIF says. The consumption index increased slowly and steadily. The State implemented flexible management of monetary and exchange rate policies, presaging an average basic interest rate of 6 per cent in 2017. The nation is forecast to achieve its money supply and credit growth goals.

Economic expert Vu Dinh Anh says the exchange rate between the Vietnamese dong and US dollar will fluctuate in 2017, in accordance with economic and financial changes in the world, reports the Tien Phong newspaper.

This year, Vietnam needs more active and flexible exchange rates, Anh says. The value of the Vietnamese dong can suffer from growth of inflation, while import volume and the price of petrol and other goods will increase.

Le Xuan Nghia, a member of the National Financial and Monetary Policy Advisory Council, says the council predicts interest rates hikes of 1-2 percent, depending on directions from the State Bank of Vietnam, reports the Giao thong newspaper.

Economic expert Vo Tri Thanh says Vietnam’s economic growth next year will be boosted by the processing industry, foreign direct investments, and the construction and services sectors.

In 2017, the agriculture sector will improve, while the construction sector will still face many difficulties. The property market will not experience a bubble but Vietnam will not be able to attract as much foreign investment as in 2016, he says.

The Government has set economic development targets of 6.7 percent GDP growth, 4 percent inflation and export value growth of 6-7 percent for 2017.

Source: VNA

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