GDP grows 5.93 percent in the first nine months of 2016

The lastest data of the General Statistics Office (GSO) showed that Vietnam’s gross domestic product (GDP) in the first nine months of 2016 increased by 5.93 percent year-on-year.

This figure is lower than the 6.53 percent recorded in the same period last year. Mr. Nguyen Bich Lam, Director General of the GSO, said that this growth rate falls short of expectations.

However, Vietnam’s economy showed that continuous quarter-on-quarter GDP rises during the reviewed period with 5.48 percent in Q1, 5.78 percent in Q2 and an estimated 6.04 percent in Q3.

The lower GDP’s growth rate in the first nine month of 2016 is attributable to the growth of agriculture, forestry, and fishery sector stays lower than that of the same period last year. The agro-forestry-fishery sector grew 0.65 percent – the lowest year-on-year rate in the last six years, contributing 0.11 percentage point to the overall GDP.

Although mining sectors, especially crude oil and coal exploitation, has continuous declined, the industry and construction sector rose by 7.5 percent year-on-year, contributing 2.52 percentage points to the whole growth. The industrial sector’s stable growth at 7.19 percent is attributable to the strong development of processing and manufacturing, said Mr. Ha Quang Tuyen, Director of National Accounts Department under the GSO. The growth of industry sector in the first nine months of 2016 is lower than the growth of the same period last year with 9.86 percent.

The services sector rose by 6.66 percent, respectively adding 2.52 and 2.55 percentage points to the nine-month figure.

The GSO also reported a low inflation rate and a year-on-year increase of 6.7 percent in export revenue in the first nine month of 2016. Moreover, the banking system’s Vietnamese dong liquidity has been ensuredand credit institutions’ activities and the monetary market remain stable while the credit growth was at over 10 percent during the reviewed period.

From January to September, 2016, 81,451 enterprises registered to do business with a total registered capital of 629.094 trillion VND (28.21 billion USD), up 19.2 percent year-on-year on the number of enterprises and up 49.5 percent year-on-year on registered capital. On average, each newly-registered enterprise has capital of 7.7 billion VND (345,300 USD), up 25.4 percent compared to the same period last year. Accordingly, over 1.789 trillion VND is used for business in three quarters of the year.

The GSO forecast that the production and business in the Q3 is better, especially foreign-invested companies and state companies. Up to 85.6 percent of enterprises in the survey report stable production status including 48.8 percent of them being predicted to grow more.

Mr. Nguyen Bich Lam said that the Government need to continue a proactive and flexible monetary policy in close coordination with the fiscal policy and inflation control, keep doing business support measures and restructuring State-owned enterprises. in order to achieve this year’s GDP growth target of 6.7 percent. Interest and exchange rates must be aligned with domestic and global fluctuations and agricultural restructuring and rural development must also be accelerated, Mr.Nguyen Bich Lam added.

Ms. Le Thi Minh Thuy, Director of Trade and Service Statistics Department under the GSO, called for augmenting the shipment of competitive goods and enhancing trade promotion.

Mr. Ha Quang Tuyen expressed that if those suggested solutions are taken, GDP in Q4 will enjoy a breakthrough growth compared to the previous quarters.