Friday, October 23
       

Economic Growth in Vietnam for 2017

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The Vietnamese economy is expected to be steady with inflation remaining under control. In addition, the Government will continue to implement measures to improve the business and investment environment and support businesses. — Photo giaothongvantai.vn

By Thiên Lý

Trần Văn Mỹ, general director of Phong Điền Scavi Company, said that his company is building an industrial center specializing in textile and garment at the Phong Điền Industrial Park Huế City.

The first hub of its kind in Vietnam was in fact run on a trial basis in 2015 and 2016.

Mỹ said the facility is due to be put into operation in the second quarter of this year, bringing together various segments involved in textile production such as feed stock, fabric accessories, design, fashion illustration and finally production of large volumes of finished products for exports.

This closed production chain is expected to help not only strengthen the brand appeal and prestige of Vietnamese garment and textile products in the global market, increasing exports, but also address the current scale in the sector.

It is also expected to attract foreign investment since many foreign apparel manufacturers are keen to invest in the Vietnamese textile industry where there are specialized models.

Elsewhere, the CEO of Vietnam VP9 Company,  said his company has set itself a sales target of US$300 million from technological products, particularly internet-based television cameras.

Explaining the company’s ambitious target, he told Tài Chính & Chứng Khoán that Việt Nam is the first country in the world to successfully develop smart cameras that run Android and install millions of Android applications, ushering in a new era of the internet of things.

Those smart products are now in demand around the world, and so are expected to be shipped to major markets such as the US, Europe and Japan, he said.

Besides focusing on exports, many companies including State and private ones have also drawn up ambitious strategies to expand their shares in the domestic market this year by enlarging distribution networks and consolidating their brand strengths.

They include Việt Tiến Garment Company, Sài Gòn Co.op, Thegioididong, FPT, Vingroup and Vinamilk. They plan to increase their investments by 50 per cent to expand their distribution systems.

It is not only such big companies but also many small ones, including start-ups, who plan to step up investment in production and business and their distribution networks this year.

Analysts said many companies hope to increase exports this year thanks to possible advantages created by positive changes expected in both the domestic and global economies, including free trade agreements, many of which effect this year.

The International Monetary Fund (IMF) has predicted the global economy to grow by 3.5 per cent this year, while the World Bank believes 3.1 per cent growth is likely.

The Vietnamese economy is expected to be steady with inflation remaining under control. In addition, the Government will continue to implement measures to improve the business and investment environment and support businesses.

According to the Ministry of Trade and Industry, in 2017 Vietnam’s economic integration will be further momentum.

It will have to implement all commitments under the ASEAN Free Trade Agreement with China and with other ASEAN member countries, the ASEAN Economic Community (AEC), World Trade Organization (WTO), and new generation free trade agreements.

This is expected to create highly favorable conditions for the country’s economic development.

But analysts also warn about the many challenges in both the domestic and overseas markets that Vietnamese enterprises might face and have to overcome if they want to seize the opportunities, particularly for exports.

They said the growth quality as well as competitiveness of the Vietnamese economy remains low. Besides there is macroeconomic instability and infrastructure lack of adequate to meet the development needs.

Recent global developments such as US President Donald Trump’s protectionist rhetoric and Britain’s vote to quit the EU show that some major economies are tending to protectionism and reduced trade liberalization.

This will change the structure of global commodity supply and demand, significantly affecting the global market and of course exports by Vietnamese businesses.

The analysts said Vietnamese businesses should focus on exploiting their domestic market, adding it would be an important factor in survival and development.

 

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