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2008 GDP may not reach 7% as targeted: MPI
Deputy Minister of Planning and Investment Cao Viet Sinh said that considering socio-economic development in the first nine months of the year, it will be very difficult to obtain the GDP growth rate of 7% this year the government wanted.
“The GDP growth rate in the third quarter of 2008 was higher than those of the first two quarters of the year. However, the 7% GDP growth rate for the year is not very likely,” Sinh said at a conference reviewing production and business in the first nine months of the year held in Hanoi late last week.
The GDP growth rate was 6.55% in the third quarter of the year as announced by the Ministry of Planning and Investment (MPI), while it was 6.5% in Q1 and 5.83% in Q2.
The thing that MPI thinks is the biggest worry now is that industrial production, the key to economic growth, still bears high costs. Industrial production in September reached VND55.7tril, which showed a modest increase of 0.1% over August.
In the first nine months of the year, the industrial value growth rate was 16%, a little lower than 17.1% of the same period of last year.
However, optimistic figures have come from export increases and trade gap decreases. The report by the Ministry of Industry and Trade showed that while the export turnover to the US, which consumed 20% of Vietnam’s exports, decreased in the last time due to the financial crisis, the ASEAN market saw the impressive growth rate of 40%. Meanwhile, exports to Africa and Southwest Asia increased by 33%.
Vietnam’s total export turnover was $48.5bil in the first nine months of the year, an increase of 39% compared to last year. Last year saw an 18.4% increase in the same period over the previous year.
“The targeted $19bil trade gap (29% of total export turnover) which ministries have projected for 2008 proves to be feasible,” Sinh said.
In fact, the trade gap of 32.6% of total import turnover in the first nine months of the year remains high. However, the trade gap of $500mil in September proved to be an encouraging figure if compared with previous months and with the previously forecasted $800mil.
The international payment balance has been supported by other good news, including satisfactory foreign direct investment (FDI). Vietnam attracted $45.7bil in the first nine months of the year, far exceeding the $27.3bil worth of FDI capital in 2007.
MPI believes that as the national economy is better off, curbing inflation rate at 25% proves to be within reach.
VNN
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