Economy in the first 6 months of the year: Positive growth

Manufacturing and processing industry develops strongly in the first 6 months of 2024.

flourish

The negative economic growth shock of 8.25% from the deep decline of the processing and manufacturing industry (down 24.3%) in 2023, which lasted until the end of the first quarter of 2024 (down 1.5%), ended from the second quarter of 2024 and growth was positive at 2.7%.

The Department of Planning and Investment announced that industrial production, processing and manufacturing has shown an increasing trend, clearly demonstrated through surveys and investigations. In the second quarter of 2024, the economy witnessed the recovery of the industrial sector (up 14.8%).

This is an impressive increase after a long series of difficulties since the beginning of 2023. The processing and manufacturing industry is a bright spot that plays a leading role in this recovery (up 12%).

According to statistics, agriculture, forestry, fisheries, trade and tourism are being identified as key sectors, supporting the economy with stable growth.

Industry is the main driving force of the economy as the industrial production index in the first 6 months increased by 5.8%, of which the processing and manufacturing industry increased by 7.8%.

Many businesses have had new contracts and orders. The largest number are textile and garment enterprises, wood chips, and locally produced and assembled automobiles, which have also increased by 4% (over 19,300 units).

The number of workers employed in industrial enterprises has increased to 35.8%. Unemployment, which puts pressure on social life, is no longer a concern as previously predicted.

Garment products of enterprises are receiving more and more orders.

Surveys by the General Statistics Office forecast that in the third quarter of 2024, most businesses believe that if the regional and world situation is stable, their production and business activities will stabilize or may expand.

About 30.7% of surveyed enterprises forecast that production will improve, 46.9% of enterprises believe that it will maintain the current growth rate.

Manufacturing industries such as food processing, garment manufacturing, paper and paper products, rubber and plastic products, and motor vehicle manufacturing are forecast to perform better.

In the third quarter of 2024, the trend of businesses having orders increased. About 26.7% of businesses forecast an increase in the number of new orders and 49% of businesses believe it will remain stable.

Mr. Ho Quang Buu - Vice Chairman of the Provincial People's Committee said that the broken supply chain has been restored. Some key manufacturing industries in the industrial sector are no longer haunted by recession.

The agriculture, forestry and fishery sector continues to be the mainstay of the economy. The service sector is vibrant and maintains its growth. Tourism stimulus programs have created momentum for the development of other service sectors.

“Although there has not been a real breakthrough, the economy in the past 6 months has changed for the better, improving compared to the same period last year in most areas. This is the basis to create momentum for economic development in the last 6 months of the year,” said Vice Chairman of the Provincial People’s Committee Ho Quang Buu.

Can't be optimistic yet

Bright spots in the economy have been seen, but there are still many “uncertainties” for the economy. This is reflected in the not-so-bright statistics.

That is the number of 21 investment projects licensed in the past 6 months (14 domestic investment projects with a total capital of 4.2 trillion VND and 7 FDI projects with a capital of 124.2 million USD) that have just begun and have not contributed anything to local economic development.

Industrial enterprise labor increased rapidly.

22.2% of businesses still assess that they will face more difficulties and 24% of businesses have reduced orders. The number of businesses entering and re-entering the market (more than 830 businesses), the decrease in the number of businesses (down 11.6%) and registered capital (down 13.5%) cannot compensate for the departure of more than 960 businesses (up 9.57%). The number of businesses continuing to leave the market is at risk of not stopping.

Recently, the Heineken Quang Nam Brewery - one of the largest manufacturing enterprises, one of the four pillars of local budget revenue, announced its closure, making it difficult for the economy to predict in which direction it will develop so that it can be optimistic.

The two main drivers of the economy, public investment and budget revenue, have not shown any signs of growth as a series of difficulties for businesses have not been resolved in the short term. Disbursement results are still too low (20.8%) and domestic revenue has only reached 50.51% (VND 10,152 billion).

A large amount of capital that could contribute to economic growth or circulate cash flow for investment and construction enterprises is stuck in the state treasury.

Director of the General Statistics Office Le Quy Dat said that the economy has not yet fully recovered. The driving forces of economic development have changed positively, but it is difficult to create a strong breakthrough. The agricultural sector is stable, while tourism and services lack breakthrough factors. Enterprises still face difficulties in the market.

Disbursement of public investment is still too low, not creating a driving force for economic development.

“The health of the economy is still weak. Some industries are recovering slowly due to the decline in consumer demand, limited internal strength and competitiveness. Investment attraction is low. No major projects have come into operation, especially in the industrial and public investment sectors, leading to a lack of new development momentum for the economy,” said Mr. Dat.

Many questions have been raised about how to "protect the fragile achievements" of the economy, and whether we are optimistic about the development of local production and business or not?

The answer is yes, based on policies related to expanding credit room, reducing value added tax, extending special consumption tax... will help businesses have the strength to stay in the market, have the opportunity to expand production and business.

The government and management agencies hope that the policy of reducing 50% of registration fees for domestically produced and assembled cars will be issued soon, creating a driving force for strong growth in the automobile manufacturing and assembly industry.

Mr. Ho Quang Buu - Vice Chairman of the Provincial People's Committee said that the government and management agencies will use all their capabilities to identify and analyze unstable factors.

At the same time, quickly implement support policies from the central government, and make every effort to support businesses to maintain production and business development momentum with specific actions.

Source: https://baoquangnam.vn/kinh-te-6-thang-dau-nam-da-tang-truong-duong-3137222.html