VNDirect: Vietnam's GDP growth in 2024 could reach 6.9%

(VTC News) - VNDirect Securities Corporation raised its forecast for Vietnam's GDP growth in 2024 to 6.9% from the previous figure of 6.7%.

" We raise our 2024 GDP growth forecast to 6.9%. We believe that Vietnam's economy will continue to maintain strong growth momentum in the fourth quarter with GDP forecast to increase by 7.1%, mainly due to positive manufacturing and export activities; abundant FDI inflows; recovery of the real estate market and the Government's growth support measures, including monetary and fiscal policies. Therefore, we raise our 2024 GDP growth forecast for Vietnam to 6.9% from the previous forecast of 6.7%, reflecting the higher-than-expected growth in the third quarter and expectations for positive growth in the fourth quarter, " VNDirect's report stated. VNDirect is also optimistic that Vietnam's GDP will continue to grow by 6.9% in 2025 thanks to the global trend of monetary policy easing; positive outlook for Vietnam's manufacturing and export sectors; continued improvement in domestic consumption demand; and private investment gradually recovered.

VNDirect raises Vietnam's GDP growth forecast for 2024 to 6.9%. (Illustration photo)

2024 marks a significant change in global monetary policy, witnessing 150 interest rate cuts compared to only 23 interest rate hikes. This easing trend is taking place in most major central banks, including the Fed, ECB (European Central Bank) and PBOC (People's Bank of China). VNDirect forecasts that the global monetary policy easing trend will likely continue until at least 2025, when inflation in developed countries gradually reaches the targets of central banks. According to VNDirect, this will open up more room for the State Bank of Vietnam to operate monetary policy in a growth-supporting direction in the coming period, including promoting money supply growth through purchasing foreign exchange reserves and maintaining or even slightly reducing operating interest rates to keep market interest rates low, thereby promoting credit growth. In addition, the loose global credit environment will also boost cross-border investment and strengthen the prospects for not only FDI but also foreign portfolio investment (FII) into Vietnam in 2025. Furthermore, the loose global credit environment, together with improved real incomes (thanks to lower inflation), will boost consumer demand and boost economic growth, especially in developed economies. " Stable global growth will be a supportive factor for Vietnam's export and manufacturing prospects next year. Accordingly, we forecast Vietnam's import-export turnover to grow positively at 9-10% in 2025 ," VNDirect forecasted. FDI inflows into Vietnam are also expected to remain positive in 2025, with a growth rate of 8-9%, while import-export value grows by 9-10% thanks to a stable global economic outlook and a gradually easing credit environment. Previously, in the third quarter, Vietnam's GDP increased by 7.4%, marking the highest quarterly growth since the increase of more than 13.7% in the third quarter of 2022 after the Government officially opened the economy after COVID-19. According to VNDirect, the growth rate of 7.4% exceeded the unit's previous forecast of 6.6%, as well as causing a big surprise to the market, especially in the context of the recent super typhoon Yagi. " GDP growth of 6.8% after 9 months has strengthened the belief that Vietnam can achieve the GDP growth target of 6.5-7% in 2024 - the target was adjusted up from the initial level of 6-6.5% ," VNDirect said.

PHAM DUY - Vtcnews.vn

Source: https://vtcnews.vn/vndirect-tang-truong-gdp-cua-viet-nam-nam-2024-co-the-dat-6-9-ar904453.html