The Asian Development Bank (ADB) has revised down its forecast for Vietnam’s gross domestic product (GDP) growth in 2023 to 5.2 percent from the previous estimate of 5.8 percent.

The bank projected the Southeast Asian country’s economic growth to be six percent next year.

Vietnam’s economy slowed more than expected in the January-September period of this year, growing 4.2 percent, half of the rate in the same period of last year. 

The weaker growth reflects the cumulative impact of falling external demand, weak budget execution, and a sluggish recovery in jobs and domestic consumption.

On the supply side, economic growth is being impeded by lower industry and service output, according to the ADB’s Asian Development Outlook released on Wednesday.

The country’s headline inflation edged up to 3.2 percent, while core inflation was at 4.3 percent between January and November. 

But it was still well below the State Bank of Vietnam’s 4-4.5 percent inflation target. 

Vietnam’s prudent and proactive monetary policy, supported by price controls on gasoline, electricity, food, healthcare, and education, should keep inflation in check.

ADB maintained its forecasts for Vietnam’s inflation at 3.8 percent for 2023 and four percent for 2024.

At a cabinet meeting chaired by Prime Minister Pham Minh Chinh in October, the government chose the growth target of six percent as the best-case scenario for this year.

Dr. Huynh The Du, a Vietnamese economic expert, said the target was 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 although the target is lower than the 6.3 percent set early this year.

Last month, Vietnam's lawmaking National Assembly passed a resolution, setting the target of a 6-6.5 percent GDP growth rate for next year.

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