Vietnam’s 2011 inflation may be 9.5 pct, WB says

Vietnam’s economy could grow 6.3% in 2011, down 0.5% year on year but its inflation may be just 9.5% only, World Bank said in its latest report.

Citing the report, Gross Domestic Product of Vietnam in 2011 is expected to reach $115 billion, against the last year’s $105 billion.

Though the country’s GDP will have slowed down, consumer prices are signing to be more satisfactory. After the inflation rose to 11.8% in 2010, even some times 12.2% during Tet Holiday, it is forecast to fall to one-digit within this year, particular 9.5% according to WB report. Thanks to the government’s measure to curb rising prices, WB report said that Vietnam’s inflation could be brought to 6.5% by 2012.

Reportedly, a short term fall in growth rate of Vietnam came from the move that the government launched an array of bold measures in February early with an aim to restore its macro-economy by adjusting forex rate, tightening up gold trade management, changing monetary and financial policies. The government also inspected and limited the operation scope of banks and state-owned enterprises.

WB assessed, above sustainable policies showed Vietnam going in right direction to break the period of from overheated development to then slowdown in recent years. Although the macroeconomic policies will likely make an economic slowdown in short term, these will help Vietnam attain its pre-crisis growth potentials in medium term if they are implemented well.

According to the updated report announced yesterday (March 22), WB also said East Asia region might reach an economic growth of 8% in two years 2011 and 2012, a slight fall compared to 2010’s 9.6%.

Inflation continues becoming a major challenge in short term for regional countries, causing difficulties for low-income households. Strongly increased consume prices in the region are translated into economic in the near future.

China is predicted to remain major supply source for the region. Meanwhile, GDP of Japan, damaged by the earthquake, tsunami and nuclear crisis, will slow in temporary time, said WB. – Vietbiz24

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