ADB maintains forecast for Vietnam's economy to grow 6.0% in 2024

DNVN - The Asian Development Bank maintains its forecast for Vietnam's economic growth in 2024 at 6.0% despite prolonged uncertainties from the external environment.

At the press conference announcing the Asian Development Outlook (ADO) Report for April 2024 on April 11, the Asian Development Bank (ADB) maintained its previous forecast for Vietnam's economic growth this year despite prolonged uncertainties from the external environment. Vietnam's economy is expected to grow by 6.0% in 2024 and 6.2% in 2025.

According to ADB, weak global demand and high international interest rates have impacted Vietnam's growth in 2023. However, a rapid shift to growth-supportive monetary policy and large-scale public investment are among the key measures taken to sustain growth recovery in 2023.

ADB held a press conference to announce the Asian Development Outlook (ADO) Report in April 2024 with confidence in the recovery of Vietnam's economy in 2024.

Mr. Nguyen Ba Hung - Chief Economist of ADB in Vietnam commented that the relatively comprehensive recovery in the export processing and service industries and stable performance of the agricultural sector are expected to support Vietnam's recovery momentum.

Positive foreign direct investment (FDI) and remittance inflows, sustained trade surplus, recovering domestic consumption, and continued fiscal stimulus with a substantial public investment program are seen as key to boosting growth in 2024.

According to Mr. Shantanu Chakraborty - ADB Country Director for Vietnam, Vietnam's economy is expected to grow at a solid pace this year and next, despite a challenging global environment. However, global geopolitical uncertainties and structural constraints in the domestic economy may affect this outlook.

Therefore, policy measures in 2024 will need to combine short-term growth support measures to boost domestic demand with long-term structural improvements to promote sustainable growth.

Weakening global demand due to slow economic recovery and delayed interest rate normalization in the US and other developed economies, coupled with ongoing geopolitical tensions, could hamper a full recovery of Vietnam's export-led growth in 2024, according to Mr. Shantanu Chakraborty.

To boost growth, the ADB Country Director for Vietnam recommended that Vietnam needs to take strong measures to reduce its heavy dependence on the export processing industry of FDI enterprises. At the same time, more systematic measures are needed to improve legal and regulatory processes to reduce barriers to implementing public investment projects.

The Asian Development Outlook (ADO) report for April 2024 emphasized that public investment will remain a driving force for Vietnam's economic growth. Effective implementation of public investment is important to promote growth.

Ha Anh

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