The World Bank has maintained Vietnam’s GDP growth forecast at 6.5% in 2020, unchanged from its previous prediction last June, according to the World Bank latest report tilted “2020 Global Economic Prospect.”
In 2020, the country’s domestic demand is set to benefit from generally supportive financial conditions amid low inflation and robust capital flows.
World Bank’s forecast is in line with that of HSBC as it expected the economy to expand 6.6% year-on-year, putting Vietnam among fastest growing economies in East Asia and Pacific. HSBC stated as FDI inflows continues to add production capacity, Vietnam’s manufacturing sector is likely to remain robust.
On November 11, the National Assembly approved Vietnam’s socio-economic development plan for 2020, including the GDP growth target of 6.8%.
Vietnam’s GDP growth in 2019 achieved an impressive pace of 7.02%, far exceeding the target set by the National Assembly at 6.6 – 6.8%. This marked the second consecutive year that Vietnam’s economy expands over 7%, following a 10-year high GDP growth of 7.08% in 2018.
According to the World Bank’s report, global economic growth is forecast to edge up to 2.5% in 2020 as investment and trade gradually recover from last year’s significant weakness but downward risks persist.
Growth among advanced economies as a group is anticipated to slip to 1.4% in 2020 in part due to continued softness in manufacturing. Growth in emerging market and developing economies is expected to accelerate this year to 4.1%. This rebound is not broad-based; instead, it assumes improved performance of a small group of large economies, some of which are emerging from a period of substantial weakness. About a third of emerging market and developing economies are projected to decelerate this year due to weaker-than-expected exports and investment.
In the East Asia and Pacific, regional growth is projected to ease to 5.7% in 2020, reflecting a further moderate slowdown in China to 5.9% this year amid continued domestic and external headwinds, including the lingering impact of trade tensions.