Vietnam’s economic growth is projected to soften to 6.3% in 2016. (Photo: Bloomberg)
is leading the fast-growing economies in the Southeast Asian region, helped by rapidly growing exports of electronics and garment manufactures, the International Monetary Fund said in its latest “Regional Economic Outlook for Asia and the Pacific” report.
“In Vietnam, exports and FDI are expected to perform well as cost-sensitive producers continue to be attracted by the country’s large labor force and generally low wages,” says the report.
growth is expected to decelerate to a still-robust 6.3% in 2016 and to 6.2% in 2017, according to the IMF
. The country’s economy expanded 6.68% in 2015, the fastest pace in at least five years.
“In Vietnam, where debt levels are high, fiscal consolidation is needed to provide space for potential bank and SOE restructuring costs,” the report notes.
According to the IMF, Vietnam’s fiscal deficit as per GDP is forecast to narrow to 6.4% in 2016 and 5.8% in 2017, compared with 6.5% in 2015.
Malaysia’s economic growth is forecast to slow to 4.4% this year from 5.0% in 2015 while the Philippines is expected to see its GDP grow 6.0% in 2016, up from 5.8% in 2015. Growth in these two countries is expected to remain robust, underpinned by resilient domestic demand.
Growth in Asia and the Pacific is expected to remain strong at 5.3% this year and next, accounting for almost two-thirds of global growth.