HSBC Hails Vietnam Positive Economic Signs

4:36:37 PM | 9/5/2012

Hongkong and Shanghai Banking Corporation (HSBC) has said in its recent report that Viet Nam’s economy is recording positive changes and projects that the country will post a growth rate of 5.1 percent this year.
The report came after optimistic assessments on Viet Nam’s macro-economic situation made by other foreign financial institutions like JPMorgan Chase and Standard & Poor's (S&P).
On its latest report themed “Viet Nam at a glance”, with a sub-heading “Good things come to those who wait”, HSBC said that the State Bank of Viet Nam (SBV) has become more transparent by announcing the country’s bad debts that accounted for 8.6-10 percent of outstanding balance.
These signaled that the Vietnamese Government would take other steps to address weaknesses long existed in State-owned enterprises.
In spite of domestic oil price increases, in August, inflation rate was 5 percent, falling from 5.5 percent in July. Although export was lower than that of the previous years, it still remained at a two-digit number. Foreign currency reserves rose and market confidence in the SBV was reinforced.
According to HSBC, strong political endeavor was attributed to these positive changes.
Despite weak domestic demand, overseas demand for Vietnamese goods seems to pick up. Export volume went up 13 percent in August, up 1.6 percent against July. Imports saw 8 percent year-on-year increase and 12.8 percent month-on-month surge.
The bank was pessimistic about the country’s export in the coming time. 
However, it proposed Vietnamese policymakers focus on ensuring economic stability and productivity and handling bad debts in the banking system.