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Vietnam’s economic recovery to accelerate remarkably in H2: Standard Chartered

by VNA29 August 2022 Last updated at 15:35 PM

Illustrative image. (Photo: VNA)
Illustrative image. (Photo: VNA)

Vietnam’s economic recovery will be stronger in the second half of 2022, particularly as the country resumed its tourism activities after a two-year closure, according to Standard Chartered ’s latest Vietnam report.

The report said the Vietnamese economy will continue recovering in August as the recovery has shown signs of broadening. The bank maintained its forecast for Vietnam’s GDP growth at 10.8% and 3.9% in the third and fourth quarters of this year, respectively, taking the full-year growth to 6.7%.

Tim Leelahaphan, Standard Chartered Economist for Thailand and Vietnam, anticipated that the recovery will accelerate remarkably. However, he also warned that high global oil prices may have negative impacts on the Vietnamese economy.

Retail sales are estimated to grow strongly, at 60.2% in August, from 42.6% in the previous month, the report added. Industrial production, export and import are expected to increase by 15.2%, 15% and 15.2%, respectively, this month compared to 9.8%, 3.4% and 11.2% in July.

Vietnam may record a trade deficit this month which is likely to stand at around 1.4 billion USD. Electronic products remained the country’s biggest currency earner. Inflation is projected to stand at 3% in August, compared to 3.2% in July, which is within a manageable level. Price pressure may increase in the second half of 2022 and in 2023. The bank recommended the State Bank of Vietnam to be wary of financial instability risks.

Experts from HSBC have also predicted that despite a less rosy external picture, Vietnam’s economy continued to gain traction.

Textile, garment and footwear exports rose by 30% from a year earlier. Retail sales posted a record growth rate of over 55% last month compared to the same period last year. In particular, revenue of tourism -related sectors was considerable, witnessing a double-digit expansion for four straight months.

Also in July, Vietnam attracted more than 350,000 foreign tourist arrivals, tripling the monthly average in H1, and bringing total visitors to the country so far to over 1 million. Those from the Republic of Korea, Europe and the US accounted for nearly half of the total figure./.

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