Vietnam growth pace accelerates in Q2

Vietnam’s economy expanded by 4.14% in the second quarter from a year ago, despite slowing global demand for imports, the General Statistics Office (GSO) said on Thursday.

The export-driven economy, one of the world’s fastest-expanding economies, picked up from slow growth of 3.31% in the first quarter amid prolonged global headwinds.

In the first half of 2023, the economy expanded by 3.72% year-on-year, the GSO said. The industrial manufacturing sector rose by 0.44%, while the retail and service sector soared by 10.9%.

In the year to June 20, the total registered FDI in Vietnam, which includes newly-registered capital, capital expansion of operational projects, and capital contribution for stake acquistions, reached $13.4 billion, down 4.3% year-on-year. Disbursed FDI in the period hit $10.02 billion, up 0.5%.

Vietnam’s exports in the first half totaled $164.45 billion, down 12.1% year-on-year. Its total import spending was $152.2 billion, down 18.2%. The period’s trade surplus was $12.25 billion, 10 times higher than the first half of last year.

The GSO said core inflation rose 4.74% year-on-year, with the consumer price index (CPI) up 3.29%.

Vietnam's economy expanded by slightly more than 8% in 2022 as it recovered post-pandemic.

For this year, the World Bank put its June growth forecast for Vietnam at 6%, among the highest in Asia and on par with the Philippines. Previously, the bank estimated Vietnam’s 2023 GDP growth at 6.3%.

Standard Chartered Bank, in its latest report last week, said Vietnam’s slowing economy was expected to recover in the second half of this year.

HSBC Vietnam, also in an update this month, trimmed its 2023 growth forecast for the economy to 5% from its previous 5.2%, taking into account a protracted and deeper-than-expected trade downturn.