A healthier banking sector with fewer non-performing loans and increased net exports will support strong GDP growth of 5.4 percent in Vietnam this year which will accelerate to 5.7 percent in 2015 and 2016, the Vietnam Investment Review reported on March 10.

The paper said the information was cited from a latest report from the Institute of Chartered Accountants in England and Wales (ICAEW), a world leading professional membership organisation headquartered in London.

According to the report, robust growth will come on the back of the country becoming more open to international investors, which will help attract capital into the economy.

Increases in government spending, partially thanks to the equitisation of state-owned assets, is also expected to support growth rates over the next few years.

Demands on energy will continue to grow with the economic boom and in this regard, Vietnam may soon join its ASEAN neighbours in becoming a net energy importer.

In many ASEAN countries, demand for energy is growing at a faster pace than domestic production and continued economic expansion may well mean these economies becoming increasingly dependent upon international energy markets to meet their needs.

This will mean countries are vulnerable to unexpected price movements which could have an effect on inflation. However, falling global oil prices between 2014 and 2016 – and the entrance of Iran into the global energy market -should help mitigate inflation in the region, the report read.

“Economic growth in Vietnam is set to accelerate as relatively cheap labour, a disciplined labour force and improving conditions for investors continues to attract new capital. As long as this cost advantage remains, Vietnam will benefit from strong growth and investor appeal,” said Douglas McWilliams, ICAEW chief economist and executive chairman of Cebr.

The ICAEW report Economic Insight: South East Asia is produced by Cebr, ICAEW’s partner and economic forecaster. Commissioned by ICAEW, the report provides its 142,000 members with a current snapshot of the region’s economic performance.

The report undertakes a quarterly review of South East Asian economies, with a focus on the following countries as Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.-VNA