Positive growth of industrial production, supported by higher consumption and export
According to the Vietnam General Statistics Office (GSO), in eleven months, industrial Production Index (IPI) rose 9.7% from the same period last year (it grew by 7.5% in 2014’s similar period). Of industries, the mining and quarrying increased by 8.1%, contributed 2.1 percentage points to the general growth; the manufacturing went up by 10.1%, contributed 6.8 percentage points; the power generation and supply raised by 11.5%, contributed 0.7 percentage point; the water supply and sewage treatment rose 7.5%, contributed 0.1 percentage points.
Growth in the manufacturing sector is likely to continue with foreign direct investment disbursements hitting record levels in the first six months of 2015.
In ten months, consumption index grew by 12.8% over the same period in 2014. Stock index for the entire manufacturing industry as of 01 November 2015 rose 9.7% over the same period last year. Stock rate for the entire manufacturing industry on average in ten months of 2015 was 72.9%.
Generally, in eleven months, export turnovers was estimated to reach US$148.7 billion, increased by 8.3% from the same period last year, of which the domestic economic sector achieved US$43.6 billion, decreased by 2.6%; the FDI sector (including crude oil) gained US$105.1 billion, grew by 13.5%.
Increasing number of new enterprises
In eleven months of this year, the country had 86,853 enterprises registered for new establishment with a total registered capital of 538.7 trillion dongs, an increase of 28.1% in the number of businesses and an increase of 37.7% in the registered capital over the equivalent period in 2014. In addition, there were 742.2 trillion dongs of additionally registered capital of enterprises changed to raise the capital in the past eleven months. Thus, the total of both newly and additionally registered capital in eleven months of 2015 was 1280.9 trillion dongs.
Increasing number of new
enterprises reflects the better business confidence in Vietnam, thanks to
improving economic growth performance, which was being driven by a number of
factors, particularly stronger manufacturing output, rising consumer spending
and macroeconomic stability. Mid-term growth stronger will be supported by
domestic demand; robust export performance, low inflation and improved
confidence have enabled Vietnam to create firmer foundations for.
Monthly index of industrial production
Source: Vietnam General Statistics OfficeBut business environment is not without difficulties
However, the number of suspended enterprises re-operated in eleven months of this year was 18,646 ones, a rise of 31.2% compared to last year’s identical period.
The number of enterprises which finished the procedure for dissolving, terminating business activities in eleven months was 8468 ones, decreased by 2.2% from the same period last year, of which most of them are small-scale businesses with a registered capital of less than 10 billion dongs.
The number of enterprises having difficulty forced to temporarily cease operations in eleven months was 62,713 ones, an 21.4% higher than the same period last year, of which 14,843 enterprises registered for time-limited temporary cessation of operations and47,870 enterprises waiting for closing the enterprise code or without registration.
In the near future, the Vietnamese economy continues to face macroeconomic challenges, including low global commodity prices, difficulties in exporting to China, higher competition from other exporters in the international market. The problem is more serious when among the current TPP signatories, Vietnam, with the lowest per capita GDP-has unique comparative advantages, particularly in labor-intensive manufacturing.
To mitigate these challenges, Vietnam should enhance deepen industrial structural and financial sector reforms, in order to increase productivity and boost competitiveness.
