Vietnam’s GDP likely to grow 5.6 pct in Q1 2011

The forecast that Vietnam’s gross domestic product (GDP) is likely to grow 5.4-5.6 percent in the first quarter of 2011 was discussed in the Government Meeting on March 15, the state-owned Thoi Bao Kinh Te Viet Nam newspaper reported.

With this, Q1 GDP growth is expected to be lower than one year earlier (5.83% in Q1 of 2010), representing the lowest growth since the second quarter of 2009.

According to Dr Nguyen Dinh Cung-Vice Director of Central Institute for Economic Management (CIEM), the estimate showed adjustments from enterprises in facing macro-economic volatilities.

By the end of 2010, CPI ended up 11.75% whilst interest rates increased highly and forex rate changed. A part of Q1 this year is continuing suffering the volatile trend.

In theory, in order to keep output prices against a rise in input prices, enterprises will have to reduce quantity. This means that total demand is unchanged, less supply is expected to rise as a compensation for rising costs, Dr Le Xuan Nghia, Vice Chairman of National Finance Supervisory Committee spoke at a seminar held on the same day. Otherwise, inflationary costs make quantity fall.

Meanwhile, a source from governmental meeting on March 15 said that criteria on international trade surged sharply year on year. Total foreign trade of Vietnam in the first quarter is estimated at $18.8 billion, a year on year growth of 29.7% and 3 times higher than the National Assembly’s target. In which, the import spending will be $21.8 billion, up 23.9% compared to the same period of 2010.

GDP growth and foreign trade targets for the financial year will be officially announced by the end of March.

Tags: Vietnam economic, Vietnam economy, Vietnam GDP, Vietnam GDP 2011