Illustrative image (Source: VNA) Hanoi (VNS/VNA) - Vietnam’s economy is not likely to experience an economic crisisnext year, according to Minister of Planning and Investment Nguyen Chi Dung,though it has suffered such crises in 1979, 1989, 1999 and 2009, followingconsistent 10-year cycles.
Dung spokeat the national governmental e-meeting reviewing Vietnam’s socio-economicdevelopment in the first half of 2018 on July 2.
The risk ofan economic crisis in 2019 has been discussed in the media in recent days, ascommentators wonder whether the booming is due for a bust.
According tothe Government official, the previous explosions had their origins in thefinancial and real estate markets, and Vietnam’s financial state of affairs isnow in good shape with the flexible management of the central bank, soundliquidity at commercial banks and stable interest rates.
As for thesecurities market, Dung said that the stock market has slowed down after agrowth spurt, while the housing market has cooled down after the Governmenttook drastic measures to reign in land speculation fever in hot markets,especially at the sites expected to become special economic zones.
“Thissuggests that the economic crisis is unlikely to occur according to the decadecycle,” Dung said.
However, headded that State management authorities needed to keep a close watch onmacroeconomic movements to take quick action in response to market changes.
He alsonoted the tendency for Vietnam’s growth to slow down towards the end of theyear.
Vietnam’sgross domestic product (GDP) dropped from 7.45 percent in the first quarter of2018 to 6.79 percent in the second quarter. The country’s first-half growthaveraged 7.08 percent, which is rather high, but to secure the annual target of6.7 percent, Dung said more efforts are necessary for the latter half of theyear.
He said thegrowth rate should reach 6.53 percent in the third quarter and 6.36 percent inthe fourth quarter to guarantee the Government’s annual growth target.
Concerninginflation, the minister said that the consumer price index (CPI) continuouslyincreased in May (0.55 percent) and June (0.61 percent) which raised concernsabout the feasibility of keeping the inflation rate below 4 percent byyear-end.
Therefore,he emphasized the need to implement price stabilisation and economic adjustmentmeasures, especially when there are typically two strong price increases at thestart of the new school year (in September) and in the last month of the year.
In addition,there is the possibility that a trade war will break out, which could bringboth challenges and opportunities for Vietnam, Dung said.
Vietnam isnot targeted in this war, so the country can take advantage of the opportunityto increase imports and exports, according to Dung. However, global instability will createcompetition between economies, which will have a significant impact ondeveloping countries, including Vietnam.
"So weneed to keep a close watch on the opportunities and challenges of thewar," the minister said.-VNS/VNA
Dung spokeat the national governmental e-meeting reviewing Vietnam’s socio-economicdevelopment in the first half of 2018 on July 2.
The risk ofan economic crisis in 2019 has been discussed in the media in recent days, ascommentators wonder whether the booming is due for a bust.
According tothe Government official, the previous explosions had their origins in thefinancial and real estate markets, and Vietnam’s financial state of affairs isnow in good shape with the flexible management of the central bank, soundliquidity at commercial banks and stable interest rates.
As for thesecurities market, Dung said that the stock market has slowed down after agrowth spurt, while the housing market has cooled down after the Governmenttook drastic measures to reign in land speculation fever in hot markets,especially at the sites expected to become special economic zones.
“Thissuggests that the economic crisis is unlikely to occur according to the decadecycle,” Dung said.
However, headded that State management authorities needed to keep a close watch onmacroeconomic movements to take quick action in response to market changes.
He alsonoted the tendency for Vietnam’s growth to slow down towards the end of theyear.
Vietnam’sgross domestic product (GDP) dropped from 7.45 percent in the first quarter of2018 to 6.79 percent in the second quarter. The country’s first-half growthaveraged 7.08 percent, which is rather high, but to secure the annual target of6.7 percent, Dung said more efforts are necessary for the latter half of theyear.
He said thegrowth rate should reach 6.53 percent in the third quarter and 6.36 percent inthe fourth quarter to guarantee the Government’s annual growth target.
Concerninginflation, the minister said that the consumer price index (CPI) continuouslyincreased in May (0.55 percent) and June (0.61 percent) which raised concernsabout the feasibility of keeping the inflation rate below 4 percent byyear-end.
Therefore,he emphasized the need to implement price stabilisation and economic adjustmentmeasures, especially when there are typically two strong price increases at thestart of the new school year (in September) and in the last month of the year.
In addition,there is the possibility that a trade war will break out, which could bringboth challenges and opportunities for Vietnam, Dung said.
Vietnam isnot targeted in this war, so the country can take advantage of the opportunityto increase imports and exports, according to Dung. However, global instability will createcompetition between economies, which will have a significant impact ondeveloping countries, including Vietnam.
"So weneed to keep a close watch on the opportunities and challenges of thewar," the minister said.-VNS/VNA
VNA
