A production line in the Jasan Textile and Dyeing Vietnam in VSIP Hai Phong, which is invested by China (Photo: VNA) Hanoi (VNA) – Theyear 2018 ends with several records, which are the highlights in the nationaleconomic panorama, laying the firm foundation for the country to strive tosuccessfully implement the Resolution of the 12th National PartyCongress and Resolution 142/2016/QH13 on the five-year socio-economicdevelopment plan for 2016-2020.
The nation’s GDP grew by an 11-year record7.08 percent, double the inflation rate, while trade surplus topped 7.2 billionUSD, the highest ever figure. Disbursement of foreign direct investment (FDI)also reached a record 19.1 percent. Inflation was kept under 4 percent for thethird consecutive year.
*Growth in most fields
“We have been able to achievegrowth in most fields in the context of complicated international situation,particularly maintaining macro-economic stability and a high growth rate, thuswinning the confidence for nearly 100 million people,” Prime Minister NguyenXuan Phuc said about the efforts of the entire political system, localities,the business community and people nationwide.
The world economic situation sawmany unfavourable developments in 2018, including the rising trend of tradeprotection, the US-China trade war, rising interest rates, and complexfluctuation of oil prices.
In the country, many outstandingproblems remained unsolved, such as limited productivity, slow disbursement ofinvestment capital despite improvements, and lower-than-expected economicrestructuring, which hindered the growth pace.
In such circumstances, the goodeconomic indicators demonstrated the success of the Government’s governance andthe great efforts of the business community and the people.
The highlights in theGovernment’s management in 2018 were the Resolutions 19/NQ-CP and 35/NQ-CP onimproving the business environment and facilitating enterprises’ development,along with Resolution 139/NQ-CP on a plan of actions to cut costs forenterprises.
The effects of the Government’sactions can be seen in the number of new businesses established during the year– 131,275 new enterprises, up nearly 5,000 from 2017.
Improvements in Vietnam’sbusiness and investment environment during the year were recognised by theinternational community. The World Economic Forum, in its GlobalCompetitiveness Report 2018, ranked Vietnam 77th among 140economies.
The European Chamber of Commercein Vietnam (EuroCham) also noted significant enhancement of the businessclimate in the country. The UK-based financial and business informationfirm FTSE Russell has added Vietnam’s equity market onto its reclassificationwatchlist, a sign that could help raise the status of the Vietnamese market inthe global markets
Vietnam also made great effortsto perfect institutions, mechanisms and policies towards meeting internationalpractices.
According to Finance MinisterDinh Tien Dung, the country has carried out its commitments on import-exporttariffs and opening of the financial service market in line with internationalagreements to which it is a member.
Such moves have helped Vietnamattract FDI and boost foreign trade. As of the end of 2018, the country has27,353 valid FDI projects from 130 countries and territories with a total 340billion USD in register capital. The FDI sector accounts for a quarter of totalsocial investment and more than 70 percent of export value, creating 8.5million jobs. Meanwhile, foreign trade revenue in 2018 totalled 482.2 billionUSD, also a record figure.
The economic restructuring hasresulted in less dependence on the exploitation of minerals and naturalresources as well as credit.
According to the FinanceMinistry, the contribution of crude oil to the State budget has decreasedcontinuously, from an average 30 percent during 2006-2020 to 4 percent thisyear, and is estimated at 3.2 percent in 2019.
Meanwhile, credit growth was at13 percent this year to December 14, lower than the level in 2017.
* Seeking new driver for growth
Think tanks and experts saidVietnam faces several risks and challenges in 2019. They pointed to thepressure created by the USD exchange rate and the world prices, the tensionfrom the prolong trade friction among big economies, rising tradeprotectionism.
The enforcement of internationaltrade deals to which Vietnam is a member brings not only opportunities but alsobig competition for domestic production and business.
As 2019 is the key year for thesuccess of the 2016-2020 socio-economic development plan, experts said thecountry needs to seek more driving forces for economic growth, first of all inthe new stage of international integration.
Next year Vietnam will completethe roadmap for its commitments as a member of the World Trade Organisation andthe ASEAN Trade in Goods Agreement, and will begin to perform its promisesunder several major free trade deals including the Comprehensive andProgressive Agreement for Trans-Pacific Partnership (CPTPP) and theVietnam-European Union Free Trade Agreement with deep and comprehensivecommitments.
Those FTAs are hoped to create adriving force for the Vietnamese economy through the high openness of theeconomy and more opportunities for FDI attraction.
The strong development of theprivate economic sector will also help drive the domestic economy forward. Inaddition, the restructuring inside each economic sector is expected to boosteconomic growth both in speed and quality, according to Director General of theGeneral Statistics Office Nguyen Bich Lam. He cited as example the shift fromlow-value crops and animals to those of higher value in the agriculturalsector, or the shift to industries making products with high added value andexport value.
* Optimize every opportunity
At a year-end working session, thePrime Minister’s advisory team noted that the economy has great potential whilemany new opportunities are expected to come next year. They said the growthpace can be maintained in the next two years if the country can take effectivemeasures to optimize opportunities and better tap the economy’s potential.
The team presented threescenarios for the economy during 2018-2020, under which the economy would growat an average 6.86 percent a year (scenario 1), 6.91 percent (scenario 2) and7.06 percent (scenario 3). The team also recommended striving for a growth rateof 6.9 – 7 percent and an inflation rate of under 4 percent in 2019.
In order to realise thesetargets, the advisory team said the manufacturing-processing industry andservices must be made the main drivers of the economy and must achieve a highergrowth than in 2018. Stronger measures are also needed to promote the privatesector.
The team proposed that the Governmentfocused its leadership on removing the four key bottlenecks, which are those inimplementing large-scale projects, developing the private economic sector,firms’ investment in agriculture and better tapping social resources.
They urged the Government to putstrong pressure on ministries, agencies and local administrations in theimplementation of instruction of the Government and the Prime Minister.-VNA
