Financial Watchdog Warns Vietnam of Economic Slowdown

Tuan Minh

09:16 02/11/2015

BizLIVE - Vietnam’s economic growth could slow down in the next quarters due to both global and domestic factors, the government’s financial watchdog has warned.

Financial Watchdog Warns Vietnam of Economic Slowdown

The industrial sector has driven up Vietnam's economy. (Photo: Internet)

The National Financial Supervisory Commission (NFSC) has upheld its forecast for Vietnam’s economic growth at 6.5% in 2015, after the country’s gross domestic product (GDP) expanded 6.5% year-on-year in the first three quarters of the year.
The industrial and construction sector, which advanced 9.57% year-on-year between January and September, was the main driver for the country’s GDP expansion in the period, the commission said in its latest report.
The commission also kept its forecast for inflation at 2% this year. Headline inflation has remained stable at 2.4% over the past months.
The government’s financial watchdog, however, warned that Vietnam’s economy may go up at a slower pace as the global economic growth continues to be anemic and the restructuring process of the domestic economy is sluggish.
“The room for the fiscal and monetary policies is narrowing, making it harder [for the Vietnamese government] to implement an economic stimulus,” says the report.
The commission forecast the Vietnamese economy to grow 6.5%-6.7% in 2016 and consumer prices to increase 3.5%-4.5%.
Vietcombank Securities late last month cautioned that the Vietnamese government needs to closely monitor risks from the Chinese economic slowdown throughout this year-end as well as in 2016.