VINACHEM

With gross domestic product (GDP) growing 4.9% and inflation picking up 2.4% against end-2012, the socioeconomic situation in the year’s first half was relatively good, said Do Thuc, director general of the General Statistics Office (GSO).

The global economy further contracts in the 2011-2013 cycle, with a growth rate of only 2.1%, according to the United Nations Economic and Social Council.

In this context, Vietnam’s economic growth is forecast to take a U shape, with 2012-2013 being the bottom. The economy will start to improve next year, Thuc predicted.

Although there are different opinions, statistics show that the Government managed to accomplish the goals of curbing inflation, stabilizing the macro-economy and achieving reasonable growth, he said.

To obtain the target for 5.5% GDP growth for the whole year, the growth rate in the second half must be 6%. “This is extremely difficult,” he said.

However, he noted that in Vietnam, management agencies had a great influence on the economy. Therefore, the 5.5% target would be obtainable if the Government increased investment and resource exploitation.

“Still, every solution has its risks. If we rushed to make investment, inflation might shoot up,” he warned.

GSO forecasts GDP growth will be 5.1-5.2% in the second half. With such a growth rate, plus healthy and stable balances, the goals for this year will be basically attained, he said.

GDP growth this year may be lower than last year, but in the current difficult context, it is not poor, he stated.

“The global GDP growth is only 2.1%. The growth rate in India fell from 11% last year to 7.7% this year. Our growth rate was 5.25% last year and even if falling to 5.1%, it is not a dramatic decline,” he said.

Total investment in the year to date has dropped to 29.6% to GDP, versus 40% in previous years. If investment continued to dwindle, there would hardly be high growth, he stressed.

The countries with rapid growth have a high ratio of investment to GDP, he remarked. For example, Thailand and Indonesia achieve growth rates of 6% when investment stands at over 35% of GDP.

“The Government has noticed this and is seeking ways to boost investment, but public investment cannot be increased. That’s the problem,” he said.

“In the current tough times, everyone longs for rapid growth. But if we hastened, policies would get from one polar to the other, and we would never be able to overcome the crisis, or the fluctuations in the already weak local economy,” he told the Daily.