The economy recovered better than expected.

Exceeding all expectations, the economy achieved a growth rate of 6.93% in the second quarter and 6.42% in the first six months, setting the stage for growth in the second half of the year and for the whole of 2024.

Growth exceeded expectations and forecasts.

Exceeding all predictions, GDP growth in the second quarter of 2024 nearly reached 7%, at 6.93%, bringing the GDP growth for the first six months to 6.42%. When announcing these figures last weekend, Ms. Nguyen Thi Huong, Director General of the General Statistics Office, emphasized the recovery trend of the economy.

Compared to the 2020-2024 period, these are also very positive growth rates. According to data from the General Statistics Office, the growth rate in the second quarter of this year was only lower than the 7.83% growth rate of the second quarter of 2022, much higher than the 0.34% growth rate of the second quarter of 2020, as well as the 4.25% growth rate of the second quarter of last year. In 2021, GDP growth in the second quarter was 6.55%, still lower than the figure for the second quarter of this year.

The growth rate in the first six months of the year was similar, only lower than the 6.58% growth rate of the first six months of 2022 in the 2020-2024 period. Specifically, the GDP growth rate in the first six months of the year compared to the same period of the previous year for the years 2020-2024 was 1.74%; 5.71%; 6.58%; 3.84% and 6.42%, respectively.

"The economy has achieved positive growth, exceeding the upper limit of the growth scenario set out in Resolution No. 01/NQ-CP," Deputy Minister of Planning and Investment Tran Quoc Phuong told a reporter from Investment Newspaper.

Economic growth in the second quarter of this year was only slightly lower than the 7.83% growth rate of the second quarter of 2022, but significantly higher than the second quarter of 2020 and the second quarter of 2023. Photo: Duc Thanh. Graphics: Dan Nguyen

Following a Q1 growth rate of 5.66%, exceeding the projected scenario, the Ministry of Planning and Investment has forecasted two growth scenarios for 2024. Specifically, in Scenario 1, the projected annual economic growth is 6%, reaching the lower end of the target set by the National Assembly . In Scenario 2, the projected annual economic growth is 6.5%, reaching the upper end of the target set by the National Assembly.

To achieve this figure, the last nine months of the year must see growth of approximately 6.75%; of which, growth in the second quarter is 6.32%, and in the third and fourth quarters it is 6.79% and 7.08% respectively. Growth in these quarters is about 0.1 percentage point higher than the upper limit of the scenario set out in Resolution No. 01/NQ-CP.

At that time, the Ministry of Planning and Investment recommended that the Government choose scenario 2 to proactively manage the economy. “Given the more favorable developments in the world and domestically, we will continue to research and implement new fiscal and monetary support policies… to strive for the highest possible growth rate,” said Minister of Planning and Investment Nguyen Chi Dung.

And indeed, the economy is unfolding according to scenario 2, as updated by the Ministry of Planning and Investment. The economy has recovered more strongly than expected, exceeding all forecasts. Recent forecasts from international financial institutions, notably UOB Bank, only predicted Vietnam's GDP growth in the second quarter at around 6%. Even before the General Statistics Office released the official figures, when the Task Force for Coordinating Macroeconomic Management (Task Force 1317) met, the forecast was only 6.2% for the second quarter and 6% for the first six months.

An opportunity for the economy to accelerate.

With such GDP growth rates in the second quarter and the first six months of the year, it is entirely possible to expect an acceleration of the economy in the second half of 2024. "Economic growth in each subsequent quarter is higher than the previous one, and various sectors and fields have achieved many important results, creating momentum for growth in the following quarters," said Ms. Nguyen Thi Huong.

According to the economic growth scenario set out in Government Resolution 01/NQ-CP, for the economy to grow by 6-6.5% this year, the first quarter must grow by 5.2-5.6%; the second quarter by 5.8-6.2%; the first six months by 5.5-6%; the third quarter by 6.2-6.7%; the first nine months by 5.7-6.2%; and the fourth quarter by 6.5-7%.

Deputy Minister Tran Quoc Phuong emphasized that GDP growth in the second quarter and the first six months will create momentum for growth in the third quarter. "This is the basis for us to strive to achieve and surpass the National Assembly's targets for the whole year," Deputy Minister Tran Quoc Phuong said.

Many macroeconomic indicators are showing positive trends. Industrial production is one example. In the first six months of the year, the industrial sector maintained its growth momentum, with some key industrial products experiencing significant increases, meeting the demand for new orders from businesses.

As a result, the added value of the entire industrial sector in the first six months of 2024 increased by 7.54% compared to the same period last year, only slightly lower than the 8.32% increase in the same period of 2022 during the 2020-2024 period, contributing 2.44 percentage points to the overall growth rate of the economy. In particular, the manufacturing industry affirmed its position as the driving force of the entire economy with a growth rate of 8.67%, contributing 2.14 percentage points.

Meanwhile, the construction sector grew by 7.34%. This is the highest year-on-year growth rate in the 2020-2024 period, contributing 0.48 percentage points. The service sector also contributed significantly to growth. The value added of the service sector in the first six months of 2024 increased by 6.64% compared to the same period last year. The positive recovery trend of tourism, wholesale, and retail services contributed greatly to the growth rate of the service sector.

Imports and exports also performed well. In the first six months, the total value of goods exports and imports reached US$368.53 billion, an increase of 15.7% compared to the same period last year. Of this, exports reached over US$190 billion, an increase of 14.5%; imports reached US$178.45 billion, an increase of 17%. The trade balance showed a surplus of US$11.63 billion.

At the meeting of Group 1317, members from the Ministry of Industry and Trade, the Ministry of Finance, and the State Bank of Vietnam all gave positive assessments of the economy, especially in the second half of the year, as the recovery trend of global trade and investment flows is expected to have a more positive impact on the Vietnamese economy. The improvement in the economies of the US, South Korea, Europe, China, etc., could have a positive effect on the Vietnamese economy. Financial institutions such as UOB and Standard Chartered also predict that the Vietnamese economy will recover more positively in the second half of the year.

Of course, there are still significant challenges, but the economic growth picture in the first half of the year is raising high expectations for the economy in 2024.

Source: https://baodautu.vn/nen-kinh-te-phuc-hoi-vuot-du-bao-d218916.html