Vietnam's Economic Outlook is Positive in 2024: Bloomberg
According to Bloomberg's latest survey, the refinancing interest rate, which is now at 4.5%, is expected to remain unchanged through 2025, despite a comeback in GDP growth fueled by strong exports. Between April and June last year, the rate was reduced three times to 4.5%, from a high of 6%.
In a previous survey, analysts predicted another 50 basis point drop over January-March. Analysts additionally raised their 2024 headline inflation forecasts, now predicting price increases of 3.6% this quarter and 4.05% the following, up 0.7% and 0.75% from the same quarters last year, respectively.
They predict that annual inflation will reach 3.5% this year, up from 3% last year, before dropping to 3.2% in 2025. The amount in 2024 remains below the government's planned range of 4%-4.5%.
Illustrative photo: Electronics production at Meiko Vietnam Company in Thach That Industrial Park, Hanoi. (Photo: Hai Linh/The Hanoi Times)
According to Bloomberg, the SBV is expected to maintain the policy interest rate steady in the coming time, leaving the government to do the hard lifting of returning economic growth to over 6% by luring investors and stimulating expenditure.
The Vietnamese economy is expected to increase 6.3% in the first quarter and 6.5% from April to June. According to Bloomberg's study, Vietnam's GDP growth is expected to be 6% this year and 6.4% next year.
Han Teng Chua, an economist at DBS Bank Ltd, said that Vietnam's economy is recovering, and foreign direct investment is likely to remain plentiful in the coming years as companies diversify and derisk their supply chains by expanding into the Southeast Asian country. In addition, competitive wage prices, a diverse network of trade agreements, and a favorable business environment are important benefits for the Vietnamese economy.
|Illustrative photo: Cargo handled at Ho Chi Minh City's Cat Lai Port. (Photo: VNA)
Previously, Andrea Coppola, World Bank Lead Economist for Vietnam, has described Vietnam in 2023 as resilient, saying that amid the global economic slowdown, Vietnam was still able to sustain a rate of growth that many other countries in the rest of the world can only dream about. According to the economist, Vietnam is an appealing destination for international investors because of its economic and political stability and its capacity to integrate into the global economy.
It is hoped that the demand for Vietnamese exports from the rest of the world will recover in 2024, he said, recommending Vietnam to leverage its internal strength and boost the productivity growth of its domestic economy to transform the challenges provided by the global economic slowdown into an opportunity to strengthen its economic growth model further.
In addition, in its recent World Economic Outlook report released in November 2023, the International Monetary Fund (IMF) predicted that Vietnam's GDP would grow by 5.8% in 2024, making it among the 20 highest-growing economies in the world.
According to the above economic experts and international organizations, in the face of numerous global and domestic challenges, and to achieve GDP growth of more than 6%, Vietnam must speed up public investment in infrastructure, support industrial, construction, and mining businesses, and create more job opportunities.
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