Vietnam economic growth to slow in 2019: IMF

By Dat Nguyen   July 16, 2019 | 11:20 pm PT
Vietnam economic growth to slow in 2019: IMF
Workers construct the first metro project in Ho Chi Minh City. Photo by VnExpress/Quynh Tran.
The International Monetary Fund has forecast Vietnam’s growth to slow down to 6.5 percent this year due to weak external conditions.

Growth, which was a 10-year high of 7.1 percent last year, is expected to be 6.5 percent in 2020 too, according to an IMF report released Tuesday.

Inflation is likely rise from 3.5 percent last year to 3.6 percent this year and 3.8 percent next year, the report said. The government hopes to keep inflation below 4 percent.

Although trade tensions and volatility affected Vietnam last year, its economy had remained resilient, fueled by healthy growth in middle-class incomes and consumption, a strong harvest and a surging manufacturing sector, the report said.

"The strong economic momentum is expected to continue in 2019, aided by competitive labor costs and other strong fundamentals, including a diversified trade structure, and recently signed free trade agreements which are spurring reforms."

The IMF’s numbers match that of the World Bank, which has forecast growth of 6.6 percent this year and 6.5 percent in 2020 and 2021.

Fitch Solutions, an arm of Fitch Ratings, said in a report earlier this year it expects Vietnam’s GDP growth to slow to 6.5 percent in 2019 in line with a wider trend of slowing global growth, but added it would remain one of the fastest growing economies in Southeast Asia.

In the first half growth was 6.76 percent, the second highest rate for the period since 2011, according to the the General Statistics Office.

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