​Vietnam to remain a fast growing Asian economy

By Dang Khoa   January 20, 2019 | 05:00 pm PT
​Vietnam to remain a fast growing Asian economy
A worker holds a metal frame at a phone assembly plant in Hanoi, Vietnam. Photo by Reuters/Kham
With a 2019 GDP growth of 6.9 percent, Vietnam will remain one of the fastest growing economies in Asia.

"We remain positive on Vietnam’s medium-term growth on strong manufacturing activity as FDI inflows to electronics manufacturing remain strong," says economist Chidu Narayanan of Standard Chartered Bank.

According to a report recently issued by the bank, the country is likely to reach GDP growth of 6.9 percent this year.

The manufacturing sector has expanded by double digits for most of the past four years and this pace is likely to continue in 2019, says the report.

The bank expects manufacturing growth to remain strong this year, though mildly lower than in 2018. Strong FDI inflows to manufacturing will likely support robust manufacturing output, it says. 

Standard Chartered economists also forecast FDI disbursement to stay at $15 billion this year and FDI inflows to the manufacturing sector, particularly electronics manufacturing, to remain high in the medium term.

FDI disbursement in Vietnam reached a record $19.1 billion in 2018, a year-on-year increase of 9.1 percent,  according to the Ministry of Planning and Investment.

"Most macro-economic indicators improved in 2018, interest and foreign exchange rates were kept stable despite the Fed’s hike in interest rates and U.S.-China tension, and non-performing loans were well-managed below three percent," says Nirukt Sapru, CEO Vietnam and ASEAN and South Asia Cluster Markets.

"We believe that the Vietnamese economy will remain one of the fastest growing in Asia and likely the fastest-growing ASEAN economy in 2019."

The World Bank forecast that Vietnam’s GDP is likely to drop to 6.6 percent in 2019 and 6.5 percent in 2020. Meanwhile, the Asian Development Bank (ADB) estimates the country’s GDP for 2019 at 6.8 percent.

Vietnam’s GDP growth of 7.08 percent in 2018 was the highest in a decade, according to the General Statistics Office.

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