Vietnam's economy is developing positively.

According to Bloomberg, a report by the Development Bank of Singapore (DBS Bank) stated that Vietnam's economy is recovering well.

Illustrative photo. (Source: VGP)

Foreign direct investment (FDI) will continue to increase as Vietnam remains attractive for investment in the coming years as companies diversify and reduce supply chain risks by expanding their manufacturing operations to this potential economy.

Competitive wage costs, an extensive network of trade agreements and a favorable business environment are important advantages for Southeast Asian economies.

The State Bank of Vietnam is likely to keep its benchmark interest rate steady in 2024 as it grapples with concerns over economic growth and inflation, becoming one of the first central banks in Asia to cut borrowing costs in 2023.

The refinancing rate, currently at 4.5%, is expected to remain unchanged through 2025 as GDP growth recovers on the back of strong exports, according to the latest Bloomberg survey. The rate was cut three times between April and June 2022, from a peak of 6% to 4.5%.

In the previous survey, economists predicted that the State Bank of Vietnam would cut rates by another 50 basis points in the first quarter of 2024. Analysts also raised their overall inflation forecast for 2024 and now expect prices to rise by 3.6% in the first quarter of 2024 and 4.05% in the second quarter of 2024 (up from 2.9% and 3.3% in the first quarter of 2023 and the second quarter of 2023, respectively).

Analysts predict inflation for the whole of 2024 will be at 3.5% (compared to 3% in 2023), before falling to 3.2% in 2025. Inflation in 2024 is still lower than the government's target of 4-4.5%.

According to the survey, Vietnam's economy is likely to grow by 6.3% in the first quarter of 2024 and 6.5% in the second quarter of 2024. Annual GDP growth is forecast at 6% in 2024 and 6.4% in 2025.

Source: https://baoquocte.vn/kinh-te-viet-nam-phat-trien-tich-cuc-256978.html