Vietnam Economy Grows 6.4% Amid Rising Inflation in Q2
Vietnam's economic growth accelerated in the second quarter of 2024, driven by robust exports and rising inflation, according to government data. The country's Gross Domestic Product (GDP) is estimated to have expanded by 6.93% year-on-year, up from the 5.87% growth recorded in the first quarter. This resulted in a 6.42% expansion for the first half of the year. Despite these gains, Prime Minister Pham Minh Chinh emphasized that policy would continue to prioritize growth to meet the year's target of 6.0-6.5%.
The International Monetary Fund (IMF) projects Vietnam's economic growth to be close to 6% for the year, bolstered by strong external demand, resilient foreign investment, and accommodative policies. However, the IMF also warned of potential risks from persistent low inflation, which could lead to greater pass-through to domestic inflation. The first half of 2024 saw a significant rise in industrial production by 7.5% and an 8.2% increase in foreign investment compared to the previous year. The United States remained Vietnam's largest export market, with exports to the U.S. rising by 14.5% to $190 billion. Despite these positive trends, analysts have called for further reforms to sustain and stimulate the economy.
