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COVER STORY

PHOTO: VIET TUAN
STANDING STRONG

International organizations have by and large maintained their faith
in Vietnam’s economic growth amid a host of ongoing complications.

| By NGOC LAN

2023 was yet another tough year for the ADB Country Director for Vietnam. imports over 10 per cent, resulting in
global economy with a raft of lingering Strong headwinds have come from the overall trade contracting 8.3 per cent.
issues making their presence felt. Vietnam’s global economic slowdown and collapsing While this resulted in a sizable trade
economic growth, meanwhile, has been external demand, while the government surplus for Vietnam of almost $26 billion,
forecast at only a modest level and some has been proactive in its policy response it still meant that export orders, and con-
way short of the 8.02 per cent posted in to maintain recovery. Inflation is projected sequently export-processing jobs, have not
2022. However, Prime Minister Pham at 3.8 per cent for the year, with core yet recovered. The export sector is heavily
Minh Chinh told a conference in early inflation (excluding controlled price items) reliant on FDI, which accounts for over
December that international organizations at 4.3 per cent, while the consumer price 70 per cent of total exports. The collapse
continue to view Vietnam’s economic index was only 3.2 per cent as of the end in external demand has been significant,
growth prospects in a positive light. of November. while domestic enterprises are unable to
Key challenges are being seen, espe- take up the slack.
2023 LANDSCAPE cially from the impact of negative trade Another challenge comes from slow
It was indeed a challenging year for growth. This is compounded by a short- credit growth, which had reached just
Vietnam, with the Asian Development lived recovery during the third quarter 8.21 per cent as of the end of November
Bank (ADB) revising its growth projection and a lackluster trade performance in against the targeted 14.5 per cent set by
down from 5.8 to 5.2 per cent for the year, the time since. As of the end of November, the State Bank of Vietnam (SBV). This is
according to Mr. Shantanu Chakraborty, exports were down about 6 per cent and an indication that credit demand is grow-

8 | VIETNAM ECONOMIC TIMES | JANUARY 2024 en.vneconomy.vn