WB forecasts Vietnam’s economy will expand 6 percent hinh anh 1Garment production for exports. (Source: VNA)

The World Bank forecast that the Vietnamese economy will grow at a speed of 6 percent in 2015, according to the East Asia and Pacific Economic Update released on October 5.

The country’s poverty rate is expected to reduce with extreme poverty, which is currently set at living on 1.90 USD per day or less, tapering off from 2.8 percent in 2012 to 1 percent in 2017. Meanwhile, the population living under 3.10 USD per day is predicted to dwindle to 6.7 percent in 2017 from 12.3 percent in 2012.

Economic recovery and stable macro-economic conditions will further reduce poverty. However, slower agricultural growth will affect rural resident incomes, thus increasing the urban-rural income gap, the World Bank said.

The report also pointed to challenges facing the country, such as slow growth, unstable elements spurred by the country’s dependence on trade and decreases in the prices of rice and other farm produce.

It recommended that Vietnam outline a plan to consolidate mid-term financial conditions while carrying out reforms to fortify finances for State-owned enterprises and banks.

Meanwhile, the World Bank expected the East Asia-Pacific region’s economy to expand by 6.5 percent in 2015, lower than the 6.8 percent growth of last year.

East Asia will create global momentum as it accounts for almost two-fifths of the world’s economic growth, the World Bank said.

It highlights that the region needs to prioritise prudent macro-economic management to tackle financial issues as well as deepen economic restructuring with a focus on private investment.

Axel van Trotsenburg, World Bank Vice President for East Asia and the Pacific region, said that growth in developing East Asian-Pacific countries continues to be solid, adding that the moderating trend suggests policymakers focus on structural reforms which create a foundation for sustainable, long-term and inclusive growth.

The reforms are comprised of regulatory improvements in the finance, labour and product market and measures intensifying transparency and accountability, he said.-VNA