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Vietnam's Economic Growth Predicted to Reach 7% in 2019

Growth could reach 7% for 2019, according to economic experts from the Vietnam Institute for Economic and Policy Research.

The Vietnam Institute for Economic and Policy Research (VEPR) increased its projections for the country's economic growth rates from 6.56–6.81% to 6.9% late last week, adding the country could conceivably surpass 7%. While lower than the preceding period, the April-June growth rate was stronger than the same period last year.  

Sebastian Eckardt, lead economist of the World Bank in Vietnam, explained to Nhan Dan: “Recent slower growth reflected the repercussions of unfavorable external factors on key economic sectors. The outbreak of African swine fever and a decline in international prices dampened agricultural outputs while weaker external demand moderated growth of the export-oriented manufacturing sector. But overall, the economic outlook for Vietnam this year is quite positive.”

The trade war between the US and China has contributed to the quarter's 6.71% GDP growth, according to Nikkei Asian ReviewMotivated by increased tariffs, manufacturing companies are increasingly shifting from China to Vietnam. Vietnamese exports to the US grew 27% in the first half of 2019, representing a 7% increase in total exports worth US$122 billion. Experts caution, however, that such rise could draw the ire of President Donald Trump, who recently claimed: "A lot of companies are moving to Vietnam, but Vietnam takes advantage of us even worse than China."

Despite the ravaging effects of climate change and swine fever, the agriculture, fishery and forestry sector grew 2.39% in the first half of the year, while industry and construction expanded 8.93% and the service sector swelled 6.69%. Meanwhile, direct foreign investment is at an all-time high, with 1,723 projects and total registered capital of over US$7.4 billion.

[Photo via Pixabay]

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