Economy still improving but could be hurt by external factors: NFSC

Tuesday, 2017-04-11 11:16:36
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NDO - Vietnam’s economy is still continuing the upward trend, especially in agriculture and manufacturing, but growth could be hurt by external factors, according to the National Financial Supervisory Commission (NFSC).

The NFSC said aggregate demand would improve in the time ahead, thanks to growing public investment capital in key projects and projected strong disbursement of capital for high-tech agriculture.

In addition, although the US could begin imposing trade protection measures in 2017, Vietnam’s export growth could be higher than in 2016 given the outlook of strong recovery in the US and global economies.

Meanwhile, aggregate supply, though struggling in the first quarter, is forecast to recover, thanks to a strong growth in industrial and agricultural production.

Industry will be boosted by stronger manufacturing, higher oil prices and larger imports of machinery used in production while favourable weather will make agriculture’s growth target of 2.7-2.8% more feasible.

However, external factors are exerting negative effects on growth in the short term, making it more challenging for Vietnam to achieve a growth target of 6.7% this year.

Vietnam’s economy expanded by 5.1% in the first quarter of 2017, less than the 5.48% during the same period, last year, due to weaker activity in mining and construction.

The recovery of global commodity prices was not strong enough for Vietnam to increase mining output, causing the sector to slump 10% in the three months to March, due to a 14.9% decrease in oil output and 5.6% in coal output.