HCMC’s economic growth to slow in Q2

Ho Chi Minh City’s gross regional domestic product (GRDP) is forecast to grow over 6% in the second quarter of 2024, lower than the 6.54% recorded in the previous quarter, according to the municipal Statistics Office.

At a Friday meeting on the city’s socio-economic performance so far this year, director of the office Nguyen Khac Hoang attributed the lower-than-expected GRDP growth rate to falling consumer spending, a slowdown in imports and exports, and delays in public investment capital disbursement.

According to Hoang, total retail sales of goods and consumer service revenue in the first five months of the year expanded by 10.2%, compared to 12% in Q1. Although tourism and travel saw good gains, food service revenue has decreased continuously since the year beginning.

While newly established local businesses and fresh foreign direct investments have increased, their registered capital has decreased, indicating caution in investment and business expansion, he noted

Public investment disbursement has also slowed significantly. According to the State Treasury’s HCMC branch, there was not a single week when public capital disbursement reached VND200 billion ($7.86 million) in April or May.

Five-month industrial production was the highest in the last three years but still lower than the whole country’s average, said Nguyen Ngoc Hoa, chairman of the HCMC Business Association.

“Exporters have enough orders for the second quarter, but face difficulties in meeting green standards. This could lead to a decline in orders towards year-end,” he noted.

To boost economic growth in the southern economic hub, Hoang suggested that domestic consumption should be promoted as this is a primary driving force. He emphasized the need for stimulus programs for shopping, restructuring measures, and support for traditional wet markets to overcome difficulties.

It is also necessary to accelerate budget allocations and public capital disbursements to ensure timely implementation of budget plans, he added.

Phan Van Mai, chairman of the municipal People's Committee, said the city needs to speed up public investment disbursement and focus on implementing key projects and administrative reforms.