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GDP growth continues to recover but is unlikely to reach the yearly target

Ms. Nguyen Thi Huong, Director General of the General Statistics Office.

How do you evaluate the GDP growth results in the third quarter and the first 9 months of 2023?

In the context of the world economy still having many uncertainties and difficulties, our country's economic growth in the first 9 months of 2023 maintains a positive growth momentum, the next quarter is higher than the previous quarter. Specifically, the first quarter increased by 3.28%, the second quarter increased by 4.05%, and the third quarter increased by 5.33%. Among them, there are some notable bright spots such as industrial production continuing to be improved, the industrial production index in September 2023 is estimated to increase by 5.1%. Service trade activities in September were vibrant and maintained a high increase compared to the same period last year.

In the first 9 months of 2023, total retail sales of goods and consumer service revenue increased by 9.7% over the same period last year. International visitors to Vietnam in 9 months are estimated to reach 8.9 million visitors, 4.7 times higher than the same period in 2022.

Social investment capital tends to increase, actively supporting economic growth in the last months of the year. Attracting foreign investment capital as of September 20, 2023 continues to be a bright spot in the context of many difficulties in the world economy.

The trade balance of goods in 9 months is estimated at a trade surplus of 21.68 billion USD, much higher than the same period last year of 6.9 billion USD. Overall, for the first 9 months of 2023, the trade balance of goods is estimated to have a trade surplus of 21.68 billion USD (same period last year, trade surplus of 6.9 billion USD) with key products achieving high export turnover. Notably, the domestic enterprise sector has had a stronger recovery in both exports and imports than the foreign investment (FDI) enterprise sector.

From the signals of export and import of goods, it can be expected that world demand is showing signs of recovery, Vietnamese businesses are starting to tend to import more, thereby creating momentum for Vietnam's exports. Vietnam will achieve good growth in the last months of the year as well as in 2024.

How do you forecast the growth prospects for the whole year 2023?

Besides favorable factors, there are still a number of difficulties and limitations that have hindered growth in the first 9 months of 2023. These are weak global demand recovery, high inflation, and raw material costs. Rising raw materials and unstable supply chains all lead to reduced production capacity of enterprises. Motivation from the manufacturing sector is still quite weak due to a shortage of orders. Input costs increased. Export market shrinks... Import and export activities recover slowly due to reduced world demand.

September CPI increased by 3.66%, the highest increase since March 2023. Average core inflation in the first 9 months of 2023 increased by 4.49%, higher than general inflation (3.16%) and was highest increase of the same period in the past 5 years. This is a challenge for operating monetary policy.

Faced with the above challenges, achieving the growth target of 6.5% this year is a great pressure. Economic growth will likely improve in the coming quarters, but to achieve the growth target of 6.5% for the whole year, fourth quarter growth needs to reach over 12%. This is not feasible in the current economic context.

However, despite many difficulties, from now until the end of the year, Vietnam's economy still has growth prospects from positive factors. On the demand side, investment activities will receive great support from public investment that is being aggressively deployed according to commitments from the Government, ministries, branches and local authorities, becoming a lever for foreign investment flows. State and FDI investment; Consumer demand will likely improve because consumption trends usually increase at the end of the year.

On the supply side, the agricultural sector will continue to demonstrate its role as a solid "pillar" of the economy. The industrial sector, especially the manufacturing and processing industry, escaped the negative decline since the beginning of the year and showed signs of prosperity in the third quarter, which will minimize pressure on growth.

The service sector in the last months of the year is forecast to continue to have good growth. Effectively controlled inflation will help stabilize cash flow, an important factor for economic growth. In addition, interest rates have decreased and lending interest rates are expected to continue to decrease in the near future, which will stimulate growth, support production, business and stimulate people's consumption.

Vietnam is actively implementing projects under the medium-term public investment plan and infrastructure investment projects under the socio-economic development recovery program. This is also the main driving force for economic development in the last months of the year.

To achieve the highest growth rate in the last quarter of the year, what solutions do you think we need to implement?

To promptly find solutions to overcome difficulties and proactively exploit opportunities to achieve the highest socio-economic development results in the following months in 2023, the General Statistics Office recommends that the Government continue to focus on quickly and effectively implementing financial and monetary guidelines and policies; Closely monitor and promptly update developments in the world situation, fiscal and monetary policies of countries with large economies and important trade and investment partners for Vietnam.

At the same time, effectively implement solutions on currency and interest rates to support businesses in recovering and developing production and business; manage exchange rates appropriately; strengthen the adaptability, resilience and safety of the financial and banking system. Continuously update growth and inflation forecast scenarios to proactively manage and respond to emerging situations.

Besides, promoting consumption through solutions focusing on developing the domestic market; effectively implement trade promotion programs, promoting goods distribution via digital platforms and e-commerce to expand domestic consumption; drastically implement solutions to promote disbursement of public investment capital, socio-economic recovery and development program, and national target programs.

Maximize investment resources of state-owned corporations and enterprises; more strongly promote private and foreign investment; strengthen public-private partnership (PPP); actively and proactively attract FDI selectively, ensuring quality.