Vietnam’s economy performance not too pessimistic or optimistic
VietNamNet Bridge – With the economic growth rate of 4.77 percent in the firstnine months of the year, analysts believe that the GDP growth rate would be 5.2percent for the whole year of 2012. The figure is believed to be “satisfactory,”which truly reflects the current circumstances.
GDP growth rate would be lower in 2012
The World Bank, in its report about the Asia Pacific economies released onOctober 8, predicted that Vietnam would obtain the economic growth rates of 5.2percent and 5.7 percent in 2012 and 2013, respectively, which are both lowerthan the figures of 5.7 percent and 6.3 percent forecast in May.
If this comes true, the economic growth rate would be much lower than that in2011 (5.9 percent) and 2010 (6.8 percent).
In fact, the low growth rate has been anticipated. Since Vietnam has gatheredstrength to restrain the inflation, the investment growth has been slowing down.
However, Vietnam has recently applied more flexible policies in order to rescueits businesses. As soon as the inflation rate began decreasing, Vietnam hasimmediately slashed the interest rate from 15 percent in late 2011 to 11percent.
There’s a noteworthy thing found in the World Bank’s report that the averageincome per capita in Vietnam has been increasing very rapidly, just second toChina.
The World Bank’s forecast about the low GDP growth rate in 2012 coincides withthe predictions given by other financial institutions. EIU, in its September’sreport, forecast that Vietnam’s GDP growth rate in 2012 would be 5.3 percent.Meanwhile, IMF has predicted the 5.1 percent growth rate for 2012 and 5.9percent for 2013, a considerable decrease from the 5.6 and 6.3 percent ratesreleased in April 2012.
5.2 percent is quite good: Vietnamese economists
Dinh Tuan Minh, an economist from the Center for Economic Policy Research,commented that the figure, if it turns realistic, would be “satisfactory,” whichis not too optimistic or pessimistic.
“At the end of the first quarter of 2012, the GDP growth rate was believed toreach 5.7 percent by the end of the year. Later, at the end of the secondquarter, the predicted growth rate was lowered to 5.3 percent. And with nobreakthrough made in the third quarter, the 5.2-5.3 percent growth rate provesto be reasonable,” he said.
Regarding the World Bank’s viewpoint that the average income per capita has beenincreasing rapidly, Minh believes that this is just a “general and inaccurate”comment.
Minh said that the rapid income increase may occur only with some certainclasses in the society, while the average income per capita has been increasingmuch more slowly than other regional countries.
Agreeing with the World Bank, Dr Vo Tri Thanh, Deputy Head of the CentralInstitute for Economic Management CIEM, said the 5.1-5.2 percent growth rateshould be seen as encouraging result.
Thanh has noted that a lot of policies still could not show their effects in thethird quarter. Therefore, he cannot see the “momentum” which can help makebreakthroughs in the economic recovery.
In related news, a recent report carried out by independent consultancy firmsshowed that 69 percent of businesses still believe in the government policies tostabilize the macro economy. The businesses believe that the policies would helpthe national economy recover, while only 6 percent of businesses still keepworried about the future.
The report was carried out by WWB Vietnam and the PetroVietnam FinanceInvestment and Consultancy Joint Stock Company PTSC on 110 businesses from 10key business fields.
The World Bank, in its report about the Asia Pacific economies released onOctober 8, predicted that Vietnam would obtain the economic growth rates of 5.2percent and 5.7 percent in 2012 and 2013, respectively, which are both lowerthan the figures of 5.7 percent and 6.3 percent forecast in May.
If this comes true, the economic growth rate would be much lower than that in2011 (5.9 percent) and 2010 (6.8 percent).
In fact, the low growth rate has been anticipated. Since Vietnam has gatheredstrength to restrain the inflation, the investment growth has been slowing down.
However, Vietnam has recently applied more flexible policies in order to rescueits businesses. As soon as the inflation rate began decreasing, Vietnam hasimmediately slashed the interest rate from 15 percent in late 2011 to 11percent.
There’s a noteworthy thing found in the World Bank’s report that the averageincome per capita in Vietnam has been increasing very rapidly, just second toChina.
The World Bank’s forecast about the low GDP growth rate in 2012 coincides withthe predictions given by other financial institutions. EIU, in its September’sreport, forecast that Vietnam’s GDP growth rate in 2012 would be 5.3 percent.Meanwhile, IMF has predicted the 5.1 percent growth rate for 2012 and 5.9percent for 2013, a considerable decrease from the 5.6 and 6.3 percent ratesreleased in April 2012.
5.2 percent is quite good: Vietnamese economists
Dinh Tuan Minh, an economist from the Center for Economic Policy Research,commented that the figure, if it turns realistic, would be “satisfactory,” whichis not too optimistic or pessimistic.
“At the end of the first quarter of 2012, the GDP growth rate was believed toreach 5.7 percent by the end of the year. Later, at the end of the secondquarter, the predicted growth rate was lowered to 5.3 percent. And with nobreakthrough made in the third quarter, the 5.2-5.3 percent growth rate provesto be reasonable,” he said.
Regarding the World Bank’s viewpoint that the average income per capita has beenincreasing rapidly, Minh believes that this is just a “general and inaccurate”comment.
Minh said that the rapid income increase may occur only with some certainclasses in the society, while the average income per capita has been increasingmuch more slowly than other regional countries.
Agreeing with the World Bank, Dr Vo Tri Thanh, Deputy Head of the CentralInstitute for Economic Management CIEM, said the 5.1-5.2 percent growth rateshould be seen as encouraging result.
Thanh has noted that a lot of policies still could not show their effects in thethird quarter. Therefore, he cannot see the “momentum” which can help makebreakthroughs in the economic recovery.
In related news, a recent report carried out by independent consultancy firmsshowed that 69 percent of businesses still believe in the government policies tostabilize the macro economy. The businesses believe that the policies would helpthe national economy recover, while only 6 percent of businesses still keepworried about the future.
The report was carried out by WWB Vietnam and the PetroVietnam FinanceInvestment and Consultancy Joint Stock Company PTSC on 110 businesses from 10key business fields.
OTHERS
Vietnam looking to nuclear, solar amid difficulties in coal, gas, wind, hydro
Vietnam racks up trade deficit of US$5.6 billion with ASEAN
Global fertilizer demand set to see little growth
Dollar drops, gold hits record as investors mull 'coin-toss' Fed decision
Vietnam calls for new thinking, new approaches to global challenges
More News