Vietnam targets 2024 economic growth of 6-6.5%

Vietnam’s National Assembly, the country’s supreme legislative body, has approved a resolution requiring the government to achieve GDP growth of 6-6.5% next year, higher than circa 5% seen for 2023.

The resolution on socioeconomic development was passed on Thursday with an approval rate of 90.5%.

In response to comments by some legislators that the growth goal was too high in the context of continued global uncertainties running into 2024, Vu Hong Thanh, Chairman of the parliament's Economic Committee, argued that the target had taken into account both headwinds and tailwinds as well as the overall socioeconomic development plan for the 2021-2025 period.

Drivers such as investment, consumption, tourism, and exports have gained momentum, and a host of critical national projects are being accelerated, leaving positive spillover effects in the future, Thanh added.

Per the resolution, the government has also been tasked with taming inflation at 4-4.5% next year and achieving GDP per capita of $4,700-4,730.

Other 2024 objectives are for the processing and manufacturing industry to contribute 24.1-24.2% to GDP with productivity growth of 4.8-5.3%. The figures are 1.3-1.6 and 0.2-0.7 percentage points lower than the 2023 targets, respectively.

Thanh attributed the lower figures to potential negative effects of global and regional developments such as an ailing recovery and weak orders for the country’s processing and manufacturing industry.

The objectives were set out based on the above-mentioned GDP growth pace, a labor force of 51.8 million, and an expansion of 7.83% projected for the industry-construction sector.

The resolution also requests the government to continue maintaining macroeconomic stability, exercise accommodative monetary and fiscal policies in a proper and focal manner, and further cut interest rates.

The government has been asked to remove obstacles in the corporate bond, real estate, and labor markets, and speed up the restructuring of the banking system with a focus on handling struggling banks.

Notably, the legislature asked the government to secure a sound investment environment to attract and retain foreign investors and eliminate legal bottlenecks to make the operating environment more business friendly.

At a hearing on Wednesday, Prime Minister Pham Minh Chinh pledged that the government will streamline outdated regulations and cumbersome administrative procedures to support businesses and boost economic growth.