Growth no longer dependent on crude oil and credit, official says
15:27 | 04/10/2017
VGP – Crude oil is no longer a key growth factor, Minister-Chairman of the Government Office Mai Tien Dung told a room of reporters on Tuesday.

Minister-Chairman of the Government Office, Government Spokesman Mai Tien Dung. Photo: VGP

The press conference was also attended by Minister of Natural Resources Tran Hong Ha and Governor of the State Bank of Viet Nam Le Minh Hung.

The Cabinet deliberated on components leading to record growth rate of 7.46% in the 3rd quarter compared to 5.15% and 6.17% in the two previous quarters, at its meeting on the same day, added the Government Spokesperson.

According to Deputy PM Vuong Dinh Hue, Viet Nam’s crude oil output may only reach 13.28 million tons, down by three million tons and 4.54 million tons against 2016 and 2015, respectively.

The high growth rate was mainly driven by soaring manufacturing and processing sector with a year on year increase of 13-13.5%, the highest rate since 2010, combined with impressive advancement of other sectors like tourism, agriculture-aquaculture-forestry.

Deputy PM Hue also said the total factor productivity (TFP) has rose by at least 5%-6% and contribute about 30.5%-31% to GDP growth.

In addition, incremental capital output return (ICOR) was about 4.5-5 compared to 5.3% in 2016, an encouraging signal for improvement of the quality of growth.

Minister Dung also said that the country’s GDP was not dependent on credit growth as it only expanded over 11% compared to this year’s target ò 20%.

Central Bank Governor Le Minh Hung explained that the Government did not press credit growth in exchange for high GDP.

Growth engines

The economy grew 6.41% between January and September this year compared to 5.99% of the same period last year, which showed that the Government’s measures have taken effect.

More importantly, growth recorded across various key sectors, the Government said.

The Ministry of Planning and Investment reported agriculture-forestry-aquaculture rose 2.78% in the reviewed period while industry and construction increased 7.17%.

Service sector maintained high growth momentum with 7.25%, the highest rate since 2013 while retail sales of goods and services soared 10.5%.

Despite storm hitting the central region in September, foreign arrivals were estimated at over 9.4 million, up 28.4%.

Export values exceeded the year’s target, rising 19.8% to US154 billion.

The Cabinet members expressed belief that this year’s growth goal of 6.7% is feasible thanks to positive recovery of key sectors.

The same rhythm

In a broader picture, the first three quarters featured with positive recovery in key economies and the global economy may expand 3.5%-3.6% in 2017-2018.

Many Asian economies picked up with India (over 7%), Viet Nam (6.41%), Malaysia (5.8%), and Thailand (3.7%).

According to the United Nations, global trade rose about 4.3% in the first half thanks to stable prices, recovery and improvement of business confidence in various economies.

Exports and imports of Asia’s emerging economies are recovering and contributing nearly 70% of the global import growth.

Foreign direct investment flows were forecast to climb 5% this year (compared to 2% in 2016) to US$1,800 billion and key destinations are the US, China and India.

The positive growth signals across the world offer Viet Nam opportunities to expand exports and lure foreign investment but competition will strengthen in both domestic and foreign markets./.

By Hai Minh

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