Vietnam’s
industrial and external activities gained pace in April, which suggests
that its economy is maintaining a relatively robust pace moving into 2Q17.
Looking ahead, we expect Vietnam’s real GDP to grow by 5.9% YoY in 2017,
albeit at a more moderate pace compared with +6.2% in 2016. This is
premised on:
i.Resilient exports due to participation in
free trade agreements (FTAs);
ii.Strong inflow of foreign direct investments
(FDI);
iii.Robust private investment;
iv.Economic restructuring and institutional
reform.
Industrial
production (IPI) picked up in April, on account of a quicker growth in
manufacturing activities and a smaller decline in mining output.
Export
growth gained pace during the month amid a pick-up in the growth of exports
from the foreign direct investment (FDI) sector. By commodity, the
acceleration was on the back of mining and manufacturing exports.
Retail sales picked up during the month, supported
by a quicker rate of growth in the hotel & restaurant and services
sectors.
Headline inflation rate
eased in April, mainly due to lower costs of food, foodstuff and
transportation. We expect full-year inflation to pick up to 3.5% in
2017, from +2.7% in 2016.
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