Vietnam's inflation is on a sharp upward trend due to higher prices of food and footstuffs as well as housing and construction materials. (Photo: VNA) In its “Vietnam Macro Monitoring” report in September, the WB said the consumerprice index (CPI) grew from 3% in August to 3.7% in September, continuing asharp upward trend that started in June.
Inflation was due to higher prices of foodand foodstuffs as well as housing and construction materials. Additionally, theprice of transport services contributed 0.3 percentage point to CPIinflation due to the new round of oil price increases registered duringJuly-September this year.
In stark contrast, core inflation whichexcludes food, fuels and government administered prices, continued to softenfrom 4% in August to 3.8% in September.
Vietnam’s economy picked up in Q3thanks to a gradual recovery of the exports, however, domestic consumptionremained subdued and credit growth continued to be slow, which reflect weakprivate domestic investment and investors’ confidence.
The WB said a strategic and well-prepared investment pipeline for 2024, and thenext Medium-term Investment Plan (MTIP) with a focus on green, resilient andregional infrastructure will help bolster long-term economic development.
The bank suggested Vietnam focus on improving the business climate andstepping up investment in human capital to attract high-tech andhigh-value-addition FDI as well as boost productivity in the long run.
Meanwhile, continued efforts to implement public investment could aggregatedemand and economic growth in the short run.
Vietnam’s economy registered 5.3% year-on-year growth in Q3 compared with 4.1%year-on-year in Q2, due to a gradual recovery of industrial production,reflecting improvement in exports.
In the quarter, the services and agricultural sectors grew by 6.2% and 3.7%year-on-year, respectively. They contributed 2.7 and 0.4 % percentage point to GDPgrowth in the period. The growth rates and contributions are comparable to theprevious two quarters.
Exports and imports grow 5.3% and 2.6% year-on-year in September. (Photo: VNA) It helped narrow the contractions in exportsand imports in Q3 to -1.2 % and -5.0 % year-on-year, respectively, comparedwith -12.2 % and -20.6% in Q2. The improvement was evident in exports ofagricultural products such as rice, textile weaving, electronics and computers.
The overall merchandise trade balance registered a surplus of 2.3 billion USDin September 2023 and 21.4 billion USD for the first nine months of the year asexports have been contracting less than imports. Also, imports are recovering fasterthan exports, signaling businesses are expecting further expansion ofproduction. Between April and September 2023, monthly growth rates for exports improvedfrom -16.2% to 5.3%, while those for imports improved from -23.1% to 2.6%.
According to S&P Global PMI survey for Vietnam, the number of exportsorders picked up in both August and September, especially from Asian markets./.
VNA
