Vietnam’s economic growth accelerated in the fourth quarter, as banks increased lending and rising foreign investment boosted exports.
GDP rose 6.96 percent in the fourth quarter from a year earlier, quickening from a revised 6.07 percent gain in the three months through September, according to data released by the official Vietnamese General Statistics Office on Saturday. For the full year, the economy grew 5.98 percent, exceeding the government’s 5.8 percent target and compared with a median estimate of 5.7 percent in a Bloomberg survey.
Vietnam’s central bank lowered the dong deposit rate cap for some terms in October, and has cut other rates and devalued the dong this year in a bid to help businesses. Exports from overseas companies in the nation increased 15 percent this year, as disbursed foreign direct investment (FDI) climbed 7 percent, data released on Friday show.
“The growth is being supported by exports, mainly from foreign companies,”Vietnam Institute of Economics director Tran Dinh Thien said before the release. “Signs of economic improvement are getting clearer, but the growth is still fragile.”
The government has taken steps to overhaul the financial system and boost lending, with credit growth rising 11.8 percent as of Friday last week from the end of last year. Meanwhile, falling oil prices have helped ease inflation, and the central bank said this week it aims to maintain the dong’s stability next year and pursue “flexible” monetary policies to boost expansion and curb price gains.
Vietnam typically releases GDP and trade data before the end of the stated period, weeks before other countries do. Some analysts have questioned the third-quarter data, with Australia and New Zealand Banking Group Ltd’s Glenn Maguire and Eugenia Fabon Victorino saying they were “skeptical of the strong growth print, as most economic indicators are pointing to weaker growth data.”
Exports grew 13.6 percent this year as manufacturers including Samsung Electronics Co and LG Electronics Inc boosted investment. Shipments from FDI companies, including crude oil, reached US$101.6 billion this year, or 68 percent of the total, data from Vietnam’s Foreign Investment Agency showed on Friday.
Inflation eased to 1.84 percent this month from a year earlier, the slowest pace since at least 2006. The government has ordered fuel retailers to cut tariffs and asked industries to stabilize prices before and during the Lunar New Year holiday in February.
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