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Vietnam’s 2023 GDP growth target of 6 percent challenging

Vietnam’s 2023 GDP growth target of 6 percent challenging

Monday, October 02, 2023, 15:40 GMT+7
Vietnam’s 2023 GDP growth target of 6 percent challenging
Employees are at work at Dony Garment Co. Ltd. in Tan Binh District, Ho Chi Minh City. Photo: Tu Trung / Tuoi Tre

The target of a gross domestic product (GDP) growth rate of six percent this year is a big challenge to Vietnam as the country needs to achieve an economic expansion of 10.4 percent in the last quarter of the year.

The International Monetary Fund has recently forecast Vietnam’s GDP growth for this year at 4.7 percent.

Meanwhile, at a Cabinet meeting chaired by Prime Minister Pham Minh Chinh on Saturday, the government chose six percent as the best-case scenario.

The target is tough although it is lower than the 6.3 percent set early this year.

The Southeast Asian nation’s GDP expanded 4.24 percent in the January-September period, according to the General Statistics Office.

The agro-forestry-fishery, industry and construction, and service sectors grew 3.43, 2.41, and 6.32 percent, contributing 9.16, 22.27, and 68.57 percent to the GDP growth, respectively. 

Industry and construction, which used to be the main driving force of the local economy, has seen its importance reduced. 

The GDP growth has three main pillars, namely domestic consumption, investment, and net exports.

The economic growth in January-September was mainly thanks to the net export, which is the difference between the monetary value of a nation's exports and imports over a certain period.

In the remaining months of this year, investment may be enhanced to boost economic growth.

Investment made up only 31.1 percent of the country’s GDP in the nine-month period, below the average of 34 percent over the past few years.

Only state investment posted a sharp increase, while private firms’ investment was almost unchanged and foreign investment inched up slightly, showing an unfavorable business environment.

If the total investment made up 34 percent of the GDP as in previous years, it will contribute significantly to the economic growth but the six-percent growth target remains demanding.

Vietnam should intensify the public investment disbursement as well as streamline credit and administrative procedures for international and domestic investors to help accelerate their investment plans.

As for trade, the country should maximize exports to improve its economic growth.

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Dr. Huynh The Du / Tuoi Tre News


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