Economists predict that Vietnam's economy would continue to strengthen

DNHN - Standard Chartered Bank estimates that the Vietnamese economy would continue to improve in August when the economic recovery process has begun to show symptoms of contagion.

Mr Tim Leelahaphan, Standard Chartered Bank's Economist in Charge of Thailand and Vietnam, stated that the economic recovery is projected to be robust in the second half of 2022, especially now that Vietnam has opened up. After a two-year hiatus, tourism has returned. Rising global oil prices, on the other hand, might have a negative influence on the economy. The bank maintains its projection of 10.8% GDP growth in the third quarter of 2022 and 3.9% growth in the fourth quarter of 2022, for a total year GDP growth of 6.7%.

Retail sales growth is likely to increase to 60.2% year on year in August, up from 42.6% in July, according to Standard Chartered Bank. Industrial production, exports, and imports are all expected to rise. predicted to rise by 15.2%, 15%, and 15.2%, respectively, compared to 8.9%, 3.4%, and 11.2% in July. In August, Vietnam is expected to run a $1.4 billion trade deficit. Electronics remain the most important export commodity.

In August, inflation was 3% year on year, up from 3.2% in July. Inflation remained under control. In the second part of 2022 and 2023, price pressure will grow. In addition to supply factors, demand pressure is increasing. Standard Chartered Bank anticipates that the State Bank of Vietnam would remain watchful against financial instability concerns.

Governor Nguyen Thi Hong stated that the State Bank expects credit growth to remain around 14% this year, despite some viewpoints that it is vital to open the credit space to relieve capital market congestion. property investment According to the State Bank, credit growth from the beginning of the year to the end of 2021 has reached 9.4%, with credit increasing by 16.7% in the first half of the year. Outstanding real estate loans represent one-fifth of the system's overall credit.

Banks may face more liquidity risk since credit in the real estate sector accounts for a substantial share, accounting for up to 94% of real estate credit balances with loan terms ranging from 10 to 25 years, while banks' mobilized capital is 80% short-term.

HSBC analysts also concluded that, despite the less rosy external outlook, the home economy continued to achieve some progress. Textile, apparel, and footwear are expected to rise rapidly, reaching 30% over the same period in 2020, thanks in part to a positive base effect. Because Ho Chi Minh City and nearby regions must undergo a period of severe social separation in the third quarter of 2021, the base impact is expected to persist until the end of the third quarter of 2022.

Furthermore, retail sales increased by more than 55% compared to the same period the previous year. Despite a favourable base effect, consumption momentum for both goods and services continued to rise sharply. Tourism-related sectors, in particular, have experienced double-digit growth for four consecutive months.

Vietnam has attracted over 350,000 foreign tourists, more than double the monthly average in the first half of 2022, bringing the total number of visitors to 1 million. Tourists from Korea (25%), Europe (13%), and the United States (10%) accounted for over half of all visits, with ASEAN nations showing the most interest. The mind is expanding.

Vietnam now issues 6,000 permits per day to Indian visitors, up from 250 before the outbreak. However, because labour is in low supply, it has not yet matched demand, particularly in certain popular tourist sites. This year, the Vietnam National Administration of Tourism hopes to attract 5 million tourists.

P.V