Vietnam to double global economic growth: IMF

The International Monetary Fund’s managing director Kristalina Georgieva called Vietnam “a shining star” and forecast the country’s growth would be twice that of the global economy.

She said this at her meeting in Hiroshima with Vietnamese Prime Minister Pham Minh Chinh, who is being in the Japanese city to attend the extended Group of Seven (G7) Summit.

Georgieva said Vietnam, with positive growth rates, is a bright star in the world economy that is undergoing economic fluctuations, risks, and impacts of the Covid-19 epidemic.

She added that Vietnam's supportive and proactive monetary policy has helped the country secure its growth momentum amid the world’s weakening growth trend.

The IMF forecast this February that the global economy would expand by 2.9% this year, down 0.5 percentage points from last year.

Recently, the World Bank predicted Vietnam's 2023 GDP growth at 6.3%; ADB had it at 6.5%; and Standard Chartered put it at 6.5%. The Southeast Asian nation’s economy expanded 3.32% year-on-year in the first four months of this year after reaching 8.02% in 2022.

Replying to the IMF leader, the Vietnamese PM asked the fund to continue providing policy advice to his government on economic management, improving fiscal and monetary tools, and restructuring the financial and banking system.

Georgieva said the IMF will keep providing advice on interest rates, monetary policy, and improving the Vietnamese economy’s strength.

PM Chinh also met with Mathias Cormann, secretary general of the Organization for Economic Co-operation and Development (OECD) in Hiroshima on Saturday. He asked the OECD to support Vietnam in new global issues like the implementation of the global minimum tax (GMT), energy security, food security, climate change, and developing a circular economy.

Cormann said OECD would support Vietnam in economic recovery and development, in building investment policies in line with the GMT. He said he expects Vietnam to join the Inclusive Forum on Carbon Mitigation Approaches (IFCMA), an initiative designed to help improve the global impact of carbon emissions.

Vietnam is seeking to reach its carbon neutrality by 2050. It is lowering carbon emissions and promoting the development of clean and renewable energy.

The GMT is a once-in-a-lifetime global tax reform. It aims at ensuring multinational companies pay their fair share of taxes of at least 15%, regardless of where they operate. Vietnam plans to enforce the tax from January 1, 2024. GMT enforcement will directly affect Vietnam’s budget revenue and competitiveness, and its ability to attract foreign direct investment (FDI).