Economic highlights of 2014
The year of 2014 was a time of big changes, from reforms in the state management mechanism to a reshuffling of the national economic structure.
GDP higher than expected, inflation a record low
Vietnam ranked second in the world in terms of the GDP growth in 2014 with the growth rate of 5.9 percent, higher than the target of 5.8 percent set up earlier by the National Assembly, and higher than 2013’s 5.42 percent.
Meanwhile, the inflation rate is at 4.09 percent, a 13-year low and much lower than the ceiling 7 percent set by the National Assembly.
Petrol price down after fall of world’s crude oil price
The crude oil price in the world market had, for the first time since July 2009, fallen to below $60 per barrel by mid-December amid worry about the oversupply.
In the domestic market, distributors 19 times lowered the retail petrol price by VND7,000 per liter.
Increasing public debt concerns Vietnamese
Prime Minister Nguyen Tan Dung said before the National Assembly that the public debt is still “safe”, and “within the safety line”.
However, economists pointed out the worrying problem that the public debt has been increasing rapidly, from 55 percent of GDP in 2010 to 60.3 percent by the end of 2014.
Long Thanh international airport project raises controversy
The $18.7 billion project on building the Long Thanh international airport, put into discussion amid the public debt increase and the drop in revenue from oil exports, has raised controversy.
The government insists on the development of the project, saying current airports are getting overloaded. However, economists remain doubtful about the financing capability of the project.
Real estate market not awake yet
“Frozen”, “gloomy”, “paralyzed” were the most common words used to describe the real estate market in 2014.
The VND30 trillion bailout launched by the government in 2013 seemingly has not helped warm up the market. Very few people still can approach loans under the program.
However, a report of the Ministry of Construction showed that real estate inventory had decreased by 14.7 percent.
SOE equitization speeds up
The equitization of the national flag air carrier Vietnam Airlines proceeded successfully after many delays. All the offered shares were sold out at the IPO in late 2014.
About 400 SOEs will undergo equitization next year.
Many M&A deals made
The year 2014 witnessed many big merger and acquisition deals. Masan Group bought 49 percent of Cholimex, one of its rivals. Standard Chartered Private Equity injected $90 million into An Giang Plant Protection Company. The Thai BJC Group spent $879 million to take over the Metro Vietnam supermarket chain.
At year end, the public heard about the huge deal of Mondelēz International, which bought Kinh Do Sweets for $370 million.
