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Vietnam Q2 GDP growth accelerates, but trade slows
VIETNAM on Thursday (Jun 29) reported faster economic growth in the second quarter, driven by the services sector, despite a slump in exports.
Gross domestic product (GDP) in the second quarter grew 4.14 per cent from a year earlier, faster than the 3.28 per cent expansion seen in the first quarter, the General Statistics Office (GSO) said in a report. First quarter growth was revised down from 3.32 per cent.
Vietnam, a regional manufacturing hub, has been trying to prop up its economy amid slowing global demand, with the central bank cutting its policy rates four times so far this year and lawmakers extending a cut in value added tax.
The services sector grew 6.11 per cent in the second quarter from a year earlier, while the agricultural sector grew 3.25 per cent, and the manufacturing and construction sector expanded 2.50 per cent, the GSO said.
“The government’s policies to encourage domestic consumption and promote tourism have contributed to the growth of the services sector,” the agency said.
Vietnam’s exports in the second quarter fell 14.2 per cent from a year earlier due to weak global demand, the GSO said, adding that imports fell 22.3 per cent.
Analysts say the sharp decline in imports could indicate a slowdown ahead in industrial production, as businesses reduce procurement of raw materials and equipment. Vietnam is a key exporter of electronics, garments and textiles, footwear and wood items, including for top global brands.
The country’s industrial output in the January-June period fell 1.2 per cent from a year earlier, it said.
Retail sales of goods and services in the first half of this year rose 10.9 per cent from a year earlier, while average consumer prices in the period rose 3.29 per cent.
The country targets GDP growth of 6.5 per cent this year, slower than an expansion of 8.02 per cent last year. REUTERS