Vietnam’s Prime Minister Le Minh Hung projected gross domestic product will expand at least 10% next year as he outlined the nation’s economic targets in a speech to parliament. Hung said the government will continue to push for double-digit growth while maintaining macroeconomic stability and keeping inflation at about 4.5% for 2027. The government will take decisive and effective measures to lower lending rates, and direct credit toward production, business and exports while ensuring sufficient electricity and fuel supplies.
Vietnam, a linchpin in global supply chains that makes products for the likes of Apple Inc. and renowned clothing brands, has experienced rapid economic growth despite the threat of US tariffs and the energy shock from the Iran war. Vietnamese officials, though, caution the economy faces challenges to hit annual growth of 10%. The central bank said it is facing mounting pressure to keep interest rates stable as the Iran conflict fuels inflation and raises banks’ funding costs, even as more loans are needed to help meet the government’s 10% growth push.
Inflation quickened to 5.08% in September from a year earlier, higher than the government’s intended cap of 4.5% this year. This is forcing the monetary authority to prioritize price and exchange-rate stability. Government data released this month showed an economy running hot, averaging 9% growth in the first three quarters, along with a surge in exports and foreign investment pledges.
The growth target of at least 10% next year reflects a strong determination of the government, yet it poses significant challenges, given that the foundation for expansion remains unstable, along with mounting inflationary pressures and increasing demand for capital and energy.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing