Vietnam’s gross domestic product (GDP
) is expected to grow 6.14% in the third quarter (Q3) of this year as the government moves to reduce red tape for businesses and encourage entrepreneurship, according to the Central Institute for Economic Management (CIEM).
The country’s exports are likely to expand 6.8%, consumer prices are forecast to increase 1.31% and a trade deficit
is seen at $0.4 billion in Q3, CIEM said in a report released Tuesday.
According to official statistics, Vietnam’s economy went up 5.48% in Q1, 5.55% in Q2. Its growth was put at 5.52% in the first half, 0.72 percentage point lower than that in the same period of 2015.
The local economy has yet to take back its recovery momentum and it will be almost impossible to reach this year’s 6.7% growth target, the CIEM report noted.
Le Dang Doanh, former director of CIEM, ascribed the slowdown to global uncertainty, the UK vote to leave the EU, and adverse weather conditions.
CIEM Director Nguyen Dinh Cung, meanwhile, commented that policies adopted by the new cabinet formed in early April somewhat caused reluctance to local businesses. They are pondering the fresh measures to draw out their strategies.
Economists present at the launch of the report recommended the government should not boost economic growth
at all costs, but stick to the goals of microeconomic reshuffle and build up room for macro management.
Cung showed his support for the government in maintaining the initial socio-economic targets. In case of failure of missing the target, policymakers and economists will take a deep look into the causes and put forward proper solutions.
The government should boost the ongoing institutional reform to create solid bases, which are higher productivity and the encouragement of the private sector, Luu Bich Ho, former head of the Development Strategy Institute under the Ministry of Planning and Investment, suggested.