Vietnam’s gross domestic product (GDP) is estimated to have risen by 6.78% this year, higher than the National Assembly’s full-year target of 6.5%, the General Statistics Office said.
This is the fastest annual growth pace over the past three years, the GSO said, reiterating that the figure was 6.31% in 2008 and 5.32% in 2009.
The local economy expanded 7.34% in the fourth quarter, compared to 7.18% in Q3 and 6.44% in Q2, the GSO said in a statement. The government-run agency also revised the economic growth for Q1 up to 5.84% from previous 5.83%.
The country’s industrial and service sectors are expected to grow 7.7% and 7.52% in 2010, respectively, while the agricultural, forestry and fisheries sector posts a modest rise of 2.78%, it said.
In 2010, the construction and industrial sector still presents the biggest proportion of 3.20% in the country’s GDP growth, followed by services sector (3.11%) and agricultural sector (0.47%).
Despite the sustainable recovery, the local economy still has a lot of latent risks due to rising inflation, long-lasting trade gap, and widening state budget deficit, local analysts said.
Strong price hike has sent the full-year consumer price index surging to a higher-than-expected level of 11.75%, thus eroding the country’s hard-won economic gains.
High inflation indicates the low quality of economic growth and cuts into incomes of salaried people and the poor, said Le Dinh An, director of the National Center for Socio-Economic Information and Forecast.
He added that fiscal and monetary policies have not been in tandem, with free-wheeling public spending remaining inefficient but monetary tightening hitting the corporate sector hard due to increasingly difficult access to expensive bank loans.
The country’s economic growth now depends heavily on investment and export, but material for export processing is mainly imported, so the trade deficit still exists. The country’s trade gap is estimated at $12.4 billion this year.
The National Assembly has set a GDP growth target of between 7% and 7.5% for next year while the consumer price index will be kept below 7%. (GSO Dec Edition, Investment)
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