The world economy has shown signs of recovery, and positive domestic GDP growth in the first 6 months of the year is the basis for Vietnam to set a growth target of 7% in 2024.
Many positive bases for 7% growth target
The government has just adjusted the target. economic growth in 2024 to the upper limit of 6.5-7% instead of 6-6.5% as before. Along with that, the Central Institute for Economic Management (CIEM) - Ministry of Planning and Investment also forecasts 2 growth scenarios in 2024, accordingly, in the high scenario, Vietnam's GDP growth will reach 6.95%. This scenario is based on the context of the world and domestic economy with positive signals and GDP growth results reaching 6.42% in the first 6 months of the year.
Commenting on the above target, Associate Professor, Dr. Bui Quang Tuan - former Director of the Vietnam Economic Institute said: Adjusting the growth target in 2024 is extremely positive and completely grounded, because currently the world economic trend has recovered, inflationary in many areas of the world has been controlled.
According to economic experts, there is a basis for hope for a 7% growth rate in 2024 when import-export growth and domestic consumption have returned in the first months of the year. Specifically, in terms of import and export, in the first 6 months of 2024, the total export and import turnover is estimated at 368.5 billion USD, an increase of 15.7% over the same period in 2023. Of which, export turnover reached 190.1 billion USD, an increase of 14.5%; import turnover reached 178.45 billion USD, an increase of 17%. In the first 6 months of this year, both export and import turnover were high compared to the first 6 months of the years (2020 - 2024). With the estimated import turnover in the first 6 months of 2024 increasing, it reflects a good signal that domestic production activities are recovering compared to the previous year, when the first 6 months of 2023 decreased by 18%.
Regarding consumption, the total retail sales of goods and consumer services revenue in the first 6 months of the year at current prices is estimated at VND3,098 trillion, up 8.6% over the same period last year. This shows that the purchasing power of the economy continues to recover after Covid-19. In addition, new-generation Free Trade Agreements (FTAs) have also brought positive signals and promoted their role and contributed to domestic economic growth.
In addition to the above motivations, Deputy Minister of Planning and Investment Tran Quoc Phuong said that foreign direct investment is also considered a bright spot in the economic picture in the first 6 months of the year and is the basis for Vietnam to achieve the growth target of 7% in 2024.
According to statistics, in the first 6 months of 2024, the total registered FDI capital reached nearly 15.2 billion USD, an increase of 13.1%. Of which, newly registered FDI was more than 9.5 billion USD, an increase of 46.9%. This is a noteworthy figure, because newly registered capital means new projects will increase the production and business capacity of the economy. Realized FDI capital reached about 10.8 billion USD, an increase of 8.2%, also a fairly good growth rate. There are also many new, large-scale projects being invested and expanded.
Regarding the expectation for the last 6 months of 2024, the Ministry of Planning and Investment is very optimistic when predicting that Vietnam will attract about 39-40 billion USD in FDI in 2024, equivalent to or higher than the results in 2023.
Still have to be alert to unexpected situations
Although the 7% growth target in 2024 is well-founded, according to Associate Professor, Dr. Bui Quang Tuan, we still need to be vigilant against unexpected situations. Analyzing the above statement, Mr. Bui Quang Tuan said that we are currently living in an unpredictable context, with many rapid changes, and those changes can very quickly disrupt supply chains. For example, conflicts in the Red Sea can disrupt the logistics supply chain immediately, not to mention conflicts between Russia and Ukraine... which can also disrupt the supply chain.
"So we must always be vigilant in responding and being cautious in policies to improve the resilience of the economy." – Associate Professor, Dr. Bui Quang Tuan informed and emphasized: We set goals but must always have backup plans. Because if we put all our efforts into the goal but there are scenarios that do not go as expected, we may encounter a passive situation.
Regarding growth drivers from now until the end of the year, according to Associate Professor, Dr. Bui Quang Tuan, they are still traditional drivers that Vietnam has advantages in, such as consumption, import and export, or opportunities from FTAs.
"However, from now until the end of the year we should exploit more new driving forces, based on the areas that Vietnam are encouraging development such as: Digital transformation, sharing economy, night economy, or growth drivers related to green transformation, green economy or many fields that Vietnam has not yet effectively exploited" - Associate Professor, Dr. Bui Quang Tuan informed.
However, to exploit new areas, Vietnam needs to have breakthrough policies, because current policies are not breakthrough enough to facilitate the participation of enterprises, the private sector, and the non-state sector. For example, the green finance sector has not attracted much attention from the private sector, because green transformation is a comprehensive and widespread transformation process in many aspects, requiring the cooperation of the private sector. But to have the private sector participate, there needs to be a mechanism to attract their participation.
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