Industrial And External Activities Surge In February

Economic Research	1 March 2017
Vietnam
Economic Update
Industrial And External Activities Surge In February Industrial and export activities surged in February, while retail sales and inflation eased during the month. Looking ahead, we expect Vietnam’s real GDP to grow by 5.9% in 2017, albeit at a more moderate pace compared with +6.2% in 2016. This is premised on: 1.      Resilient exports due to a recovery in global demand; 2.      Strong inflows of FDI; 3.      Robust private investment; 4.      Structural reform initiatives. Industrial production (IPI) growth surged in February, on account of a pick-up in manufacturing activities and electricity output due to a normalisation of activities after the festive season in January.  Export growth gained pace during the month amid a wider margin of growth in exports from both the foreign direct investment (FDI) and domestic sectors. By commodity, the acceleration was mainly led by quicker growth in manufacturing exports and a rebound in exports of agricultural products. Retail sales grew at a slower pace, dragged mainly by a slower rate of growth in the trade and services sectors. Headline inflation rate eased in February, mainly due to lower costs of food and foodstuff Economist:  Vincent Loo Yeong Hong  | +603 9280 2172 Economist: Aris Nazman Maslan | +603 9280 2184