The World Bank has kept its projections for Vietnam’s economic growth in 2018 and the upcoming two years unchanged although the country’s GDP hit an eight-year high in the first three quarters this year amidst increasing trade friction between the US and china.
Vietnam's economy grew 6.98% in the first nine months this year.
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Vietnam is among a few economies to get un upward revision for 2018. Despite escalating trade tensions worldwide, the nation’s exports upheld strong growth, said Sudhir Shetty, World Bank Chief Economist for the EAP region.
Its economy expanded 6.98% in the first three quarters this year, marking the fastest pace for the nine-month period since 2011. Meanwhile, its export turnover rose 15.4% in the January-September period, according to government data.
The Southeast Asian country’s growth is predicted to ease to 6.6% in 2019 and 6.5% in 2020, also unchanged from the previous projections, due to the envisaged cyclical moderation of global
Demand, the bank added.
The Asian Development Bank (ADB) late last month trimmed its forecast for Vietnam’s 2018 economic growth to 6.9% from an estimate of 7.1% announced in April and while the forecast for 2019 was retained at 6.8%, as the country is exposed to escalating trade dispute between the world’s two largest economies.
The World Bank forecast Vietnam’s inflation to remain around the 4% government target, predicated on some tightening of the monetary stance to counter price pressures emanating from domestic input price pressures and rising global commodity prices.
Despite improved short-term prospects, risks remain significant. Domestically, a slowdown in restructuring of the state-owned enterprise and the banking sectors could adversely impact the macro-financial situation, undermine growth prospects, and create large public-sector liabilities.
External risks include escalating trade protectionism, heightened global and regional geopolitical uncertainty, and continuing tightening of global financing conditions which could lead to disorderly financial market movements, the bank warned.
Growth in developing EAP is expected to be 6.3% in 2018, lower than in 2017 due to the continued moderation in China’s growth as its economy continues to rebalance, according to the report.
