The retail market’s expansion is said to have made up for the shrunken agriculture sector (Photo: VNA)

Hanoi (VNA) – The World Bank (WB) has revised its 2016 growth forecast for Vietnam down to 6 percent from 6.2 percent predicted earlier in the year.

In a report released on July 19, the WB said after posting strong growth in 2015, Vietnam’s economy grew at a slower pace in the first half of this year, with gross domestic product (GDP) growth at 5.5 percent, compared to 6.3 percent a year before.

The growth slowdown was attributable to the recent drought and saltwater intrusion’s adverse impacts on agriculture, and weaker industrial production.

However, the retail market’s expansion has made up for the shrunken agriculture sector, said Sebastian Eckardt, a senior economist with the WB Group.

He also spoke of the State Bank of Vietnam’s application of the daily reference exchange rate – a more flexible exchange rate management mechanism which will improve the Vietnamese dong’s resilience to global fluctuations.

Achim Fock, the WB’s Acting Country Director for Vietnam, said to maintain a high growth rate, Vietnam needs to push ahead with restructuring to promote productivity.

Although growth may slow down this year, the country’s mid-term economic outlook is still positive, he added.

The report's special focus is on promoting healthy and productive aging in Vietnam. Philip O’Keefe, lead economist for the WB’s social protection and labour global practice, said while Vietnam is among the countries with the fastest aging populations, its average income is much lower than most of the other aging population nations.

Population aging will have widespread influences on the economy and society. To mitigate those impacts, it is critical to have policy actions pertaining to the labour market, pension system and health care, he said.

The report analysed the rapid population aging in Vietnam and suggested some policy actions to cope with the problem.

About 6.5 million people in Vietnam are at least 65 years old at present. It is projected to surge almost threefold to 18.4 million by 2040.-VNA