Vietnam’s socioeconomic performance has shown significant recovery during the first nine months of 2022, with 14 out of 15 development indicators surpassing the yearly targets, including estimated GDP growth of 8%, higher than the goal set by the National Assembly by 2-2.5 percentage points.

Prime Minister Pham Minh Chinh at the session. Source: quochoi.vn

Prime Minister Pham Minh Chinh presented the Government’s socioeconomic reports at the opening of the NA’s fourth session today [October 20].

During the nine months, Vietnam's GDP growth stood at 8.83%, bringing the annual economic expansion rate to around 8%. Meanwhile, state budget revenue reached 94% of the estimate during the period, up 22% year on year, and could surpass the year’s target by 14.3%, up 2.9% against last year.

The prime minister noted the Government is making efforts to address weak banks, state-owned enterprises suffering losses, or inefficient public projects.

“Progress has also been seen in retrieving public assets from corruption and economic cases,” Chinh noted, referring to nearly VND16 trillion (US$652 million) reclaimed from criminal cases and VND22 trillion ($897 million) from credit institutions.

“Public-, Government- and foreign debts have stayed under control,” he continued. It is estimated that by the end of 2022, Vietnam’s public debt will be around 43-44% of the GDP, below the ceiling of 60%, while government debt stands at 40-41% of GDP (under the 50% ceiling), and foreign debt at 40-41% (ceiling of 50%).

Chinh, however, also acknowledged specific challenges facing the economy, including rising inflationary pressure, volatile prices of essential commodities, and an unfavorable global economic environment.

In addition, there remain risks to the stock, bond and real estate markets that should be properly addressed for sustainable and healthy development.

“Unpredictable global situation and the severe Covid-19 impacts mean it would take time for Vietnam’s economy to recover, especially with its high level of economic openness and limited resilience against external shocks,” he said.

Chairman of the NA's Economic Committee Vu Hong Thanh

Chairman of the NA’s Economic Committee Vu Hong Thanh stressed that an expected GDP growth of 8% remains high among global economies and reflects the country’s strong recovery from 2020-2021.

“This would create positive growth momentum for subsequent years,” he said.

Meanwhile, Thanh expressed concern over rising petrol prices in the domestic market and the recent shutdown of filling stations in southern cities and provinces, partly due to the shortage of petrol supplies.

He urged the Government to review the situation for timely intervention, if needed, especially at a time when the global oil and gas market is still in a volatile period.

Thanh also pointed out the slow disbursement progress of the socio-economic recovery program worth VND350 trillion ($14.2 billion), which reached 20% in the first nine months, and the 2% interest rate subsidy scheme of over VND16 trillion ($652 million) in 2022.

Overview of the session.

Stabilizing macroeconomy a priority

For 2023, the Government set the GDP growth target at 6.5% and consumer price index (CPI) at 4.5%, up 0.5 percentage points against 2022; productivity growth at 5-6%; the unemployment rate in urban cities below 4%; and multidimensional poverty down by 1-1.5%.

Prime Minister Chinh warned of high inflationary pressure and rising exchange rates in 2023, while economic issues from 2022 would continue to linger, such as high costs of input materials and lower import demands from Vietnam’s major markets.

“The main priority is to stabilize macro-economy, contain inflation, and support growth,” he said.

On this issue, Thanh from the NA’s Economic Committee called for the Government to improve its forecast capacity and prepare plans against unfavorable economic situations.

“Vietnam should avoid any mishaps during the recovery process, especially against impacts from rising prices of petrol and input materials,” Thanh said.

He expected the Government to continue proposing measures to curb rising petrol prices and support transport firms.

He said other issues, including bad debts, weak banks, cross-ownership in the banking sector and risks related to the real estate and capital markets, should also be addressed.