NFSC predicts economic growth at 5.3 percent

A report by the National Financial Supervisory Commission (NFSC) on the country’s economic situation in 2013 and outlook for 2014 and 2015 says that target growth of 5.5 percent is a big challenge for Vietnamese economy and economic growth will possibly be at 5.3 percent this year.

However, a stable macro-economic environment which is continuing to maintain this year will create a foundation for a steady growth for coming years.

According to the commission, during 2014 and 2015, the economy will see many advantages with a stable macro-economy providing favorable conditions to attract investments. Besides, foreign investment will increase as global economy will post better growth next year as well as increasing possibilities of better investments when Trans Pacific Agreement is signed in 2015.

Domestic private investment will also improve thanks to policies to support businesses as well as measures to restructure the banking system and tackle bad debt. Export is also forecast to keep good growth thanks to foreign direct investment projects which will continue to be an important push for economic growth.

Nevertheless, along with advantages, challenges remain.

Global economy is expected to rebound in 2014 and 2015 but at low levels and still with many risks. Domestically, firms will continue to struggle, especially the agricultural sector. Balancing budget will continue to pose difficulties, affecting capital allocation while economic growth in 2014 will still rely on investment capital as productivity and efficiency may not improve.

Assuming that economic growth is at 5.3 percent and inflation at 7 percent in 2013, the commission forecasts that economic growth will be around 5.6-5.8 percent and inflation at 7 percent in 2014. However, in order to achieve these results, total social investment capital must reach 30-31 percent of gross domestic product; credit growth at around 15 percent; and export raised by 12-14 percent.

By Bao Minh – Translated by Thuy Doan

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