Vietnam’s economy to grow 6.7 percent in 2016: ADB

                                         ADB Country Director for Vietnam Eric Sidgwick (M) 

The Vietnamese economy will remain stable in 2016 with a growth rate of 6.7 percent, followed by a modest slowing of growth to 6.5 percent in 2017, according to the Asian Development Bank (ADB)’s “Asian Development Outlook 2016” report, released on March 30.

Speaking at a press conference in Hanoi, ADB Country Director for Vietnam Eric Sidgwick said that the report is a flagship ADB publication which provides its assessment of recent economic developments in Asia and the Pacific and medium-term macro-economic projections for the region.

He noted that Vietnam’s economic growth will be driven by continued high foreign direct investment, rising domestic consumption and demand, and pro-growth policy settings.

In the short term, Vietnam should rebuild macroeconomic buffers to ensure the economy can be more resilient to any future economic shocks, as global instability and slowing growth in major trade partners has the potential to disrupt the country’s economic outlook, he suggested.

“Over the longer-term, greater efforts are also needed to address Vietnam’s low productivity growth, and to support domestic firms’ ability to integrate into global value chains,” he said.

According to the director, Vietnam will benefit from the signing of a range of new free trade agreements (FTAs) which, once implemented, will create many business and trade opportunities.

However, local enterprises will have to face increasing business pressure. Therefore, to maximise benefits of the FTAs, the Government should work to create an economy with higher productivity to adapt to rising competitiveness.

He also suggested the government continue taking actions to strengthen the banking system, including resolving the existing stock of non-performing loans and preventing the build-up of new ones, as this continues to stifle the creation of an efficient and inclusive financial sector.-VNA