Vietnam gov't to strive for 5% plus GDP growth, allocate $23 bln for salary reforms

The government will strive to keep economic growth at above 5% this year, missing its 2023 target of 6.5% due to adverse external impacts and prolonged internal weaknesses, said Prime Minister Pham Minh Chinh.

However, a 5% plus growth is fairly higher than many countries in the region and the world and well above the global growth of 3% forecast by the IMF, the PM noted while delivering a report at the month-long parliament session that began Monday.

Vietnam’s economy expanded 5.33% in the third quarter this year, leading to a reading of 4.24% in the nine-month period, according to official data.

Several leaders and high-ranking officials in Vietnam have mentioned Vietnam’s weaker-than-expected economic performance this year. Chinh’s statement echoed remarks made on October 8 by Party General Secretary Nguyen Phu Trong.

Vietnam’s GDP is projected to reach $435 billion this year, placing it among the 40 largest economies worldwide. Inflation is expected to end 2023 at 3.5-4%, below the mandated 4.5%, he added.

For 2024, the government aims at a GDP growth of 6-6.5%, and a GDP per capita of $4,700-4,730. Inflation would be controlled at 4-4.5% and credit growth boosted to 15%.

The prime minister pledged that the government will not allow repeated power shortages next year.

Vietnam faced a critical electricity shortage early summer this year, causing thousands of businesses to halt operations and disrupting the daily lives of millions of people.

The PM also said that the government has earmarked VND560 trillion ($23 billion) for carrying out salary reforms in the 2024-2026 period.

Local reports have said it's unclear whether the National Assembly will revise downwards the GDP growth target for 2023.