VINACHEM

The economic performance in the last months of the year is expected to be healthy thanks to improvement in three major sectors – agriculture, industry & construction, and services.

NCIF (National center for Socio-economic information and forecast), in its report released in August, predicted that Vietnam would obtain GDP growth rate of 6.5 percent this year, while the inflation rate would be 4 percent.

NCIF’s analysts were optimistic about the economic performance in the last five months of the year, impressed by the strong rise of the service sector.

The sector saw a 2-year record high growth rate in the first seven months of the year with a significant surge in goods and service consumption and satisfactory performances in banking and insurance.

Meanwhile, improvement of the industry & construction sector, which first appeared in the second quarter, is continuing. The value of the processing & manufacturing industry is expected to increase in the upcoming months with estimated phone output increase reaching 12-13 percent for the whole year.

The phone output in June increased by 5.9 percent over the same period last year, which was an impressive achievement compared with the 0.6 percent decrease in the first five months of the year.

The PMI in June was 52.5, for the 19th consecutive month exceeding the 50 score threshold. This, according to analysts, shows continued improvement in business conditions in the production sector.

The exploitation of 1.5 million tons of crude oil more will help curb the decline of the mining industry, expected to contribute 0.38 percentage points to economic growth.

The government also is optimistic about the economic growth prospects. Government Office’s chief Mai Tien Dung said at the government regular meeting on August 30 that the GDP is likely to hit the targeted rate of 6.7 percent with socio-economic performance being improved month after month.

In the first eight months of 2017, 104,511 new businesses were registered.

However, economists were cautious about the feasibility of the targeted 6.7 percent GDP growth rate.

BVSC, while describing achievements in the first eight months ‘encouraging’, says the 6.7 percent growth rate is still a challenging goal.

With a modest growth rate of 5.73 percent in the first half of the year, BVSC thinks the GDP growth rate of the entire year will be 6.3-6.5 percent.

VEPR’s director Nguyen Duc Thanh said to obtain the 6.7 percent GDP growth rate in 2017 and 6.5 percent for 2016-2020, Vietnam needs to move ahead with business environment reform which will help cut operation costs for companies. - VNN -