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VietNamNews

Domestic economy forecast to improve

Update: November, 02/2013 - 09:24

HCM CITY (VNS)  — Viet Nam's macroeconomy has a positive trend, according to HSBC Viet Nam's CEO, Sumit Dutta, but he warns that people should not expect miracles in 2014.

His bank forecasts that the country's 2014 GDP growth will be 5.4 per cent, up from what it projects for 2013 at 5.2 per cent. GDP per capita will be US$1,971, from this year's $1,750.

International FX reserves will be $35 billion compared to $30 billion expected for 2013.But the CPI is anticipated to rise to 8.3 per cent from the expected 6.7 per cent for this year. The dong vs the US dollar value will remain stable.

Viet Nam's currency ranks as the third-best performing currency in Asia (year to August), devaluating by 1.5 per cent, while Australia lost 14.5 per cent and India, 15.47 per cent. China gained 1.79 per cent and Hong Kong ranked second, losing 0.07 per cent.

Others positive trends include inflation, which is expected to be contained and strong and sustainable flows of FDI, predicted to continue. Exports will flourish and grow as well.

On the other hand, State-owned enterprises will continue to be a drag on growth, according to the bank's CEO, and the banking system's non-performing loans will take time to resolve. The real estate market will improve slowly next year.

For surviving and thriving, Sumit said liquidity was the key and there could be opportunities for cash-rich companies.

He advised businesses attending this week event on Viet Nam's macroeconomic outlook for 2014 — Will the Tiger Roar Again?, held in HCM City by the bank and the Eurocham, Cancham and several others — to keep on growing market share.

"When the tiger wakes up, you need to be ready".

"Reviewing your business model and being flexible to cope with changing trends" is also important," he added. —VNS


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