Vietnam, attractive destination for investment. (Photo: VNA)

Hanoi (VNA) – Vietnam is an attractive destination for investment amid a lackluster global economy, Nirukt Sapru, CEO of Standard Chartered Bank Vietnam said in a recent report.

The bank has raised its forecast for Vietnam ’s GDP growth this year from 6.6 percent to 6.9 percent, although global growth is likely to remain flat at 2.9 percent.

Manufacturing and construction are expected to be the biggest economic growth drivers in 2016.

According to Standard Chartered, Vietnam will become the second fastest-growing economy in Asia this year, only after India .

The bank also expected strong foreign direct investment inflows to Vietnam , the report noted, adding that the country’s GDP growth in the last six quarters were higher than targeted.

However, economist Dr. Le Xuan Nghia was not that optimistic. Many problems still challenge Vietnam’s economy in 2016, particularly in terms of interest rates, inflation, bad debts and the exchange rate, he said.

The Consumer Price Index (CPI) this year is likely to be 3.4 percent higher than 2015, Nghia added.

The economist warned that failure to tackle bad debts may increase operating costs for commercial banks, making them even more vulnerable to risks, and as a result, they will be less willing to venture into the real estate and stock markets.

The biggest concern in the long term is the rapid increase in public debt, he said.-VNA