|Speakers talk at the seminar “Wealth Through Consumption” on October 20 in HCM City. — Photo nhipcaudautu.vn|Viet Nam News
HCM CITY - Việt Nam’s economy is expected to grow at 7 per cent from around 6 per cent currently, while private consumption should increase by 5 per cent per annum from the current 4.4 per cent, says an expert.
Nguyễn Xuân Thành, director of Fulbright University Vietnam told participants at a seminar “Wealth through Consumption” held by the Nhịp Cầu Đầu tư magazine on October 20 that private consumption contributed 4.9 per cent annually to GDP growth between 2006-2010. The rate decreased to 4.4 per cent during the 2011-15 period.
He said private consumption represented major stakes in the country’s GDP, up to more than 84 per cent in 1990, then decreasing to 65 per cent during 2011-2015. It was, however still higher than the East Asia average and in other countries including China, Indonesia and India.
Thành also said domestic producers should improve their competitiveness to satisfy higher consumption to control higher imports.
In the short term the driver for consumption growth is low global commodity prices, but in the medium term, it is the growth in consumer finance, and in the long term, a growing middle class.
“The consumption-driven growth is only sustainable when supported by higher productivity and strong institutions and governance as well as improved firms’ competitiveness,” he said. - VNS