World Bank projects Vietnam to grow by 6.5% in 2018

Thursday, 2018-04-12 10:15:55
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Vietnam’s growth is expected to stabilise at around 6.5% over the next three years.
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NDO - Vietnam’s economic growth is forecast to decline to 6.5% in 2018, after growth accelerated to more than 6.8% last year, according the World Bank’s latest report released on April 12.

The figure is in contrast with the 7.1% projection made by the Asian Development Bank a day earlier, though the World Bank’s projected growth rate for 2018 is a relatively high figure.

The World Bank said that Vietnam’s growth is expected to stabilise at around 6.5% over the next three years, with the potential to surprise on the upside in the short run, especially if the global recovery remains intact.

According to the latest East Asia and Pacific Economic Update, Vietnam’s external balances are projected to benefit from robust exports and strong foreign direct investment inflows.

On the fiscal front, the combination of deficit reduction and divestment from state-owned enterprises is expected to contain public debt over the medium term.

Despite the generally favourable medium-term outlook, there are significant challenges to the Vietnamese economy, the World Bank stated.

Domestically, sluggishness in structural reforms could weaken the ongoing recovery and hinder Vietnam’s medium-term growth potential.

Externally, Vietnam’s heavy reliance on trade could expose the economy to risks associated with growing protectionism and a possible weakening in external demand.

The previous day, the Asian Development Bank (ADB) said in a report that Vietnam was set to continue its strong economic performance, with GDP growth forecast to rise to 7.1% this year, before easing back to 6.8% in 2019.