Vietnam’s GDP growth accelerates

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More moderate growth rates in Vietnam helped keeping consumer prices under control

Vietnam’s economy showed signs of regained strength in the second quarter 2012, according to figures released by the government on June 29.

GDP grew  by 4.7 per cent in the period after a four per cent expansion in the first quarter of the year, the country’s General Statistics Office said.

In the first half of the year, GDP expanded 4.4 per cent compared to the same period in 2011, boosted by the services sector which grew 5.6 per cent in the period. Industrial production and construction expanded by 4.5 and 3.8 per cent, respectively, and the agricultural sector by 2.8 per cent. At the same time, retail sales grew 19.5 per cent.

However, compared to earlier growth rates, Vietnam’s economy has lost some steam. GDP growth in 2010 was 6.8 per cent, and 5.9 per cent in 2010. The reason is that the Vietnamese government over the last quarters introduced tightening measures to tame inflation, causing economic growth to slow down, but keeping product prices under control.

Inflation in June 2012 rose 6.9 per cent from a year earlier, the slowest pace since the end of 2009, and way lower than a recent peak of 23 per cent in August 2011.

Vietnam also cut its trade deficit in the first half of 2012 almost tenfold as exports surged. The country’s trade deficit fell  to $690 million, as compared to $6.65 billion in the same period 2011. Exports in the same period were up 22 per cent, while imports rose at a slower pace of 6.9 per cent, the statistics office said. Vietnam’s major exports include garments, oil, electronics, rice and machinery.

But problems are persisting. The government figures also show that more than 21,000 businesses have gone bankrupt in the first five months of 2012, and the total bad debt ratio of Vietnamese banks has risen to ten per cent from six per cent at the end of 2011.

Vietnam targets GDP growth between 5.6 and six per cent this year. The World Bank’s forecast is 5.7 per cent. For 2013, growth is estimated to reach 6.3 per cent, and 6.5 per cent in 2014.

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Reading Time: 2 minutes

More moderate growth rates in Vietnam helped keeping consumer prices under control

Vietnam’s economy showed signs of regained strength in the second quarter 2012, according to figures released by the government on June 29.

Reading Time: 2 minutes

More moderate growth rates in Vietnam helped keeping consumer prices under control

Vietnam’s economy showed signs of regained strength in the second quarter 2012, according to figures released by the government on June 29.

GDP grew  by 4.7 per cent in the period after a four per cent expansion in the first quarter of the year, the country’s General Statistics Office said.

In the first half of the year, GDP expanded 4.4 per cent compared to the same period in 2011, boosted by the services sector which grew 5.6 per cent in the period. Industrial production and construction expanded by 4.5 and 3.8 per cent, respectively, and the agricultural sector by 2.8 per cent. At the same time, retail sales grew 19.5 per cent.

However, compared to earlier growth rates, Vietnam’s economy has lost some steam. GDP growth in 2010 was 6.8 per cent, and 5.9 per cent in 2010. The reason is that the Vietnamese government over the last quarters introduced tightening measures to tame inflation, causing economic growth to slow down, but keeping product prices under control.

Inflation in June 2012 rose 6.9 per cent from a year earlier, the slowest pace since the end of 2009, and way lower than a recent peak of 23 per cent in August 2011.

Vietnam also cut its trade deficit in the first half of 2012 almost tenfold as exports surged. The country’s trade deficit fell  to $690 million, as compared to $6.65 billion in the same period 2011. Exports in the same period were up 22 per cent, while imports rose at a slower pace of 6.9 per cent, the statistics office said. Vietnam’s major exports include garments, oil, electronics, rice and machinery.

But problems are persisting. The government figures also show that more than 21,000 businesses have gone bankrupt in the first five months of 2012, and the total bad debt ratio of Vietnamese banks has risen to ten per cent from six per cent at the end of 2011.

Vietnam targets GDP growth between 5.6 and six per cent this year. The World Bank’s forecast is 5.7 per cent. For 2013, growth is estimated to reach 6.3 per cent, and 6.5 per cent in 2014.

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