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Twin economic threats are starting to diminish
The economy remains on a stable trajectory with inflation and trade deficit threats diminishing. According to a Ministry of Planning and Investment (MPI) report released last week, Vietnam’s industrial value in May grew 13.8 per cent year-on-year.
The highest increase was seen in construction materials and electrical products like air conditioners and refrigerators. The total retail turnover rose 2 per cent against April, or up 27.1 per cent year-on-year.
The industrial and service sectors’ stable outlook since early this year implies the national economy’s strong recovery amid the globe’s rising input materials and high lending interest rates in Vietnam, said the report.
Nguyen Thanh Hoa, Vice Head of the Ministry of Industry and Trade’s Planning Department, said the rising demand in Vietnam and global economic recovery had supported the two sectors. “Manufacturers and consumers seem more optimistic about the economy and they are expanding production and consumption now,” said Hoa.
At the same time, the consumer price index (CPI) slightly increased and the trade deficit cooled. General Statistics Office figures show the trade deficit in May was $5.37 billion or 20.8 per cent of total export turnover, down from 25 and 23.1 per cent in March and April respectively.
The CPI in May rised 0.27 per cent against April or 4.55 per cent against last December. The month-on-month CPI rises in February, March and April were 1.96 per cent, 0.75 per cent and 0.14 per cent respectively.
MPI Vice Minister Cao Viet Sinh said the low CPI and trade deficit slowdown meant policies were hitting the spot. However, rising input material prices and lending interest rates remained obstacles to the local business community.
“These factors could bring high inflation back to Vietnam,” said Bui Ha, Director of MPI’s Department of National Economic Issues. The government recently announced curbing inflation and stablilising the macro-economy as its top priority this year.
vietnamnet, VIR
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