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Despite bright prospects, Vietnam's economy faces fresh challenges

21 Jun '22
2 min read
Pic: Shutterstock
Pic: Shutterstock

Despite bright prospects, Vietnam’s economy faces new challenges as the COVID-19 pandemic is yet to end and global political and economic shocks continue. Deputy minister of planning and investment Tran Quoc Phuong said the domestic business climate faces fresh, unpredictable challenges, including inflation, and wastage of precious resources.

Various forecasts suggest this year's inflation will approach the threshold of 4 per cent set by the government, and cannot be as low as the rates recorded in recent years.

Nguyen Bich Lam, former director of the general statistics office, said that with the delay of the country’s recovery and development package in the context of rising world commodity prices, inflation is likely to be around 4-4.5 per cent in 2022. He forecast the rate to move up to 5-5.5 per cent in 2023.

Phan Duc Hieu, standing member of the National Assembly’ economic committee, said increasing the economy’s absorption capacity and avoiding the waste of resources are also important, while publicity and transparency are both a solution and a requirement to improve the programme’s effectiveness and efficiency, according to a news agency report.

In 2020 and 2021, despite the pandemic’s impact, Vietnam maintained positive growth, mainly thanks to increases in import-export and investment, especially foreign direct investment. Following better COVID-19 control, a strong recovery was recorded in a number of industries, such as retail, personal goods, pharmaceuticals, logistics and forestry.

The Asian Development Bank (ADB) has forecast that Vietnam's economic growth would recover to 6.5 per cent in 2022 and reach 6.7 per cent in 2023. The International Monetary Fund (IMF) lowered its growth forecast for the global economy this year, but believed Vietnam’s recovery will be boosted by the implementation of its socio-economic development and recovery programme.

Fibre2Fashion News Desk (DS)

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