Standard Chartered Cuts Vietnam GDP Outlook to 5 per cent This Year

Standard Chartered Bank has forecast in its statement on February 17 that Vietnam's economy will slow down to 5 per cent, lower than the GDP growth of 6.5 per cent set by the government, Tai Hui, an economist and head of the bank's team of analysts for Southeast Asia said.

 

Vietnam will receive less FDI and remittances and its exports will dwindle like in other regional countries in the face of the global crisis, Tan Hui said.

 

However, trade deficit is expected to halve, inflation will be curbed at single-digit level in mid-2009 as the decline in oil, food, and rice prices will keep inflation across Asia low, he said.

 

The Standard Chartered official proposed that the government stimulate domestic demand and forecast that the communist country will further devalue the dong orderly rather than volatily. He also hailed the US$6 billion economic stimulus package by the government.

 

Regional governments should link with each other, particularly in monetary and fiscal policies to ensure a stable financial market, he appealed.

 

IMF forecast that Vietnam's economy will grow 5 per cent this year while the World Bank predicted a 6.5 per cent growth. (VNA, People's Intellect)