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BMI revises upwards forescasts on Vietnam's GDP growth
Business Monitor International (BMI) has raised its forecast about Vietnam's GDP growth in 2009 from 2.9 percent to 4.5 percent because of the government's demand stimulus policy and improved export.
The London-based independent company said in the first half, Vietnam's economy grew by 3.9 percent against a year earlier, an all-time low level, but the macro-economic information and statistics in the second and third quarters showed that the government's demand stimulation policy and the central bank's measures worked well.
However, BMI warned that Vietnam's economy needs recovery of the global demand so the country can have sustainable growth.
BMI's forecast is based on the government's demand stimulus policy and improved export. However, the economy's growth due to the government's demand stimulus policy this year will make Vietnam meet difficulties in 2010 when the government and the central bank have to cope with possible high inflation.
The company has also raised the forecast on GDP growth in 2010 to 5.5 percent from 5 percent. In long term, Vietnam 's GDP growth will return to 8 percent by 2013 when the effects of the global economic recessions eases in 2009.
It said that the economic cooperation between Vietnam and Japan as well as EU will have many good progresses.
BMI added that Vietnam's economy in recent years has continuously been one of Asia's fastest growing economies, posting an average GDP growth of 7.6 percent a year between 2000 and 2007. Vietnam has also been very successful in poverty reduction.
Upon worrying over inflation and budget deficit, some investors have reduced their forecasts about Vietnam 's economy. If the government focuses too much on stimulating the growth without settling root causes of inflation, instability will come, they fear.
BMI is optimistic about Vietnam 's economic growth prospects in the next ten years. The challenges about macro-economy in 2008 and 2009 will bring about valuable experience to Vietnam in dealing with crisis.
Policies play an important role in ensuring good development of infrastructure without making the economy have too hot growth. If there are proper policies, Vietnam 's GDP growth in the next ten years may reach 8 percent a year.
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