Vietnam Gov’t Slashes 2016 GDP Growth Target to 6.3%-6.5%

Tuan Minh

12:27 04/10/2016

BizLIVE - The Vietnamese government has admitted that it will miss the economic growth target of 6.7% set for this year.

Vietnam Gov’t Slashes 2016 GDP Growth Target to 6.3%-6.5%

The Vietnamese government has revised down economic growth target to 6.3%-6.5% this year. Photo: Internet

Vietnamese Prime Minister Nguyen Xuan Phuc on Monday lowered the country’s gross domestic product (GDP) to between 6.3% and 6.5% for the whole 2016 following a lower-than-expected pace in the first three quarters.
The PM asked government agencies to make efforts and work out concrete measures to achieve the new target, which is lower than the initially set 6.7%.  
Vietnam’s GDP expanded 5.93% in the first nine months of this year, below a 6.53% growth rate recorded for the same period of last year, according to official data. Therefore, fourth-quarter growth must be in a 7.1%-7.3% range to bring full-year expansion to 6.3%-6.5%.
“The [new] target is attainable despite being challenging. Fourth-quarter growth tended to accelerate in recent years. This year’s fourth quarter contains many good conditions that promise faster GDP expansion,” the PM said during a regular two-day cabinet gathering that started on October 3.
The country’s Nikkei Manufacturing Purchasing Managers’ Index (PMI) came at 52.9 in September, the highest level over the last 16 months, and much higher than that in neighboring countries such as China, Japan, Indonesia and Thailand.
He also urged the Ministry of Industry and Trade to ensure the power supply that can support economic growth as the government aims to double the number of enterprises to one million by 2020.
A number of international financial institutions have trimmed their GDP growth projections for Vietnam in 2016 due to natural calamities and a maritime disaster caused by a Formosa steel mill.
The Asian Development Bank last month made a deep cut of 0.7 percentage points to its 2016 growth forecast for Vietnam to 6.0%, the similar forecast earlier made by the World Bank.