Business

UOB upgrades 2022 growth forecast for Vietnam to 8.2%

Given Vietnam’s strong economic recovery in the third quarter, the Singapore-based United Overseas Bank (UOB) has raised its forecast for the country’s GDP growth this year to 8.2%, from the previous prediction of 7%.
UOB upgrades 2022 growth forecast for Vietnam to 8.2% ảnh 1The Vietnamese economy expanded 13.7% in Q3 compared to the same period last year. (Illustrative photo: VNA)
HCM City (VNA) – GivenVietnam’s strong economic recovery in the third quarter, the Singapore-based UnitedOverseas Bank (UOB) has raised its forecast for the country’s GDP growth thisyear to 8.2%, from the previous prediction of 7%.

The bank said the GDP expansion of13.7% in Q3 is a record quarterly growth rate in Vietnam and surpassed the rateof 13.5% of India to become the highest in Asia this year.

The strong GDP rebound in Q3 was thanks to a record contraction of 6% in the same period last year, when the countryhad to impose social distancing to curb COVID-19 transmission. Meanwhile, theborder reopening and easing of travel restrictions since the beginning of 2022has helped fuel business activities since Q2, especially in the service sector.

Over the past three quarters, the country's GDPincreased 8.8% year on year, compared to the growth of 6.4% in the first half.

In particular, the constructionsector expanded 8.6% year on year during the nine months, manufacturing 10.7%, andservices 10.6%. Recovery was particularly visible in the service sector, in whichaccommodation and food services rose 41.7% and entertainment services 14.5%thanks to relaxed restrictions and the return of foreign visitors, according tothe UOB.

The strong GDP recovery in Q3 hascreated a prerequisite for vigorous growth in the entire 2022. Given theyear-on-year expansion of 8.8% in the nine months, the UOB decided to upgrade itsgrowth forecast for Vietnam this year to 8.2%, it said in a report.

However, it also expressed concernabout the growth outlook for 2023, when the monetary policy strictly tightenedby central banks is set to put pressure on the US and Europe - two main exportmarkets that account for 41% of Vietnam's total exports.

The bank maintained the forecast forVietnam next year at 6.6% based on an estimation that demand in the mainmarkets will continue to slow down./.
VNA
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