A dual success of Vietnamese economy

At the beginning of the year experts were not optimistic that Vietnam could obtain high economic growth this year amid the negative impact of the COVID-19 pandemic couple with the impact of the Russia-Ukraine conflict. However, the sound performance of the national economy in the recent quarters of the year has prompted international financial institutions to revise their projections.  

Beyond their expectations, the growth rate for the year hit a 11-year record high at 8.03%, beating the 6% - 6.5% target set by the National Assembly. Meanwhile, local inflation went against the global trend to be kept at 3.15%, far lower than the 4% target set by the National Assembly.

This can be considered a dual success for the national economy given the fact that the global economy is witnessing rapid and unpredictable changes, according to Nguyen Thi Huong, director of the General Statistics Office of Vietnam (GSO).

“Global inflation has risen to the highest level in decades, forcing economies to tighten monetary policy. In addition, strategic and geopolitical competition between major powers plus the ongoing military conflict in Ukraine has increased financial, trade and investment risks. In such context, the 8.03% rate Vietnam has secured is an impressive growth rate,” elaborated Huong. 

The GSO director noted that high economic growth was largely fueled by the impressive growth of the three key pillars of the economy, with agro-forestry-fishery expanding by 3.36%, industry climbing by 7.78%, and construction rising by 9.99%.

She went on to note that the Government’s decisions to reduce taxes, fees, and charges such as VAT and environmental protection tax placed on petroleum had significantly reduced pressure on market prices and stabilised production and business activities, as well as people’s lives.

Sharing this perspective, Phan Duc Hieu, deputy director of the Central Institute for Economic Management (CIEM), stated Vietnamese GDP growth this year is very impressive given the regional economic situation. It is noteworthy that the country’s foreign trade has brought in high value in the context of global difficulties, while budget revenue also achieved remarkable results.

“Agriculture has made a silent but very important contribution to our country’s economy today,” said Hieu.

With regard to foreign direct investment (FDI), the latest statistics indicate that Vietnam attracted nearly US$27.72 billion in FDI capital this year, equivalent to 89% of last year’s figure. However, the disbursed FDI capital rose by 13.5% year on year to reach nearly US$22.4 billion.

This represents a positive sign that indicates businesses are gradually recovering, whilst moving to maintain and expand production following the pandemic, said Hieu.

The expert attributed these gains to cooperation between citizens, the Government and businesses, especially during the period of struggling with the COVID-19 pandemic, along with the great efforts made by the Party, State, Government, and local authorities, as well as the business community.

“The impressive economic growth results in 2022 were attributable to contributions of the State, people and businesses,” concluded Hieu.