Vietnam's economy predicted to grow by 6.3% in first three quarters

The regulator said economic growth for the whole of 2015 could reach 6.5% thanks to recovery in the manufacturing sector.

Vietnam's economy grew 6.03% in the January-March period, accelerating to 6.15% in the three months following, bringing growth in the first half of the year to 6.1%.

According to the NFSC, the index of industrial production rose 9.1% in the first six months of the year, much higher than the 5.8% increase during the same period of last year, with the manufacturing sector up 9.9% compared with 5.5% in 2013 and 7.5% in 2014.

In addition, a 10.9% rise in power generation and distribution indicated a strong recovery in manufacturing, which was further supported by the purchasing managers index of 54.8 in May, the highest level since the survey began in April 2011.

The first half of 2015 saw the number of newly established enterprises up nearly 22% while those forced to close dropped 5.8% against the same period of 2014.

In June, consumer price inflation and core inflation, which were 1% and 2.37% respectively, had remained largely unchanged over the four months prior, said the NFSC, predicting that core inflation for the whole of 2015 would be about 3%, while headline inflation would be less than 3%.

Despite the upbeat tone, the NFSC warned that the Vietnamese economy was still facing serious challenges such as the return of a trade deficit, a struggling agricultural sector and difficulty in tax revenue collection.

The trade gap during the January-June period was estimated at US$3.75 billion, due to growing imports and slowing export growth.

According to the NFSC, the export growth rate in the first five months of the year was less than half the rate during the same period of 2014, 7.3% compared with 15.4%, while the import growth rate nearly doubled over the first five months of last year.

At the same time, the farming sector saw a slowdown from the previous year, rising by 2.16% compared with 2.96% a year earlier.

(Source: Nhandan Online)