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2017 GDP target set at 6.7%

Released at: 17:31, 08/11/2016

2017 GDP target set at 6.7%

Photo: Duc Anh

NA approves resolution on socioeconomic targets for next year.

by Duy Anh

Vietnam has set a GDP growth target of 6.7 per cent in 2017, equal to the target set for this year, while inflation is targeted at 4 per cent against the 5 per cent targeted for this year.

National Assembly (NA) XIV approved a resolution on November 7 on the socioeconomic development plan for 2017, with 85.02 per cent of delegates voting in favor.

Exports are to increase by 6 to 7 per cent next year, the trade deficit is to be 3.5 per cent of export turnover, and social investment capital is to represent 31.5 per cent of GDP. Household poverty is targeted to decline by 1-1.5 per cent and 82.2 per cent of the population is to have health insurance.

Vietnam will press on with protecting its independence, sovereignty, territorial integrity, national security, political stability, and social order and safety, improve diplomatic activities and international integration, and promote a peaceful and stable environment for national development. 

The NA plan continues to target a stable macro-economy, economic restructuring associated with the growth model, and improved competitiveness. It also looks to encourage sustainable startup companies, ensure social welfare, proactively respond to climate change, increase environmental protection, and step up administrative reform. 

This year the original GDP target of 6.7 per cent was later revised down to 6.3-6.5 per cent. A few setbacks caused the economy to cool down, including drought and saltwater intrusion in the Mekong Delta in the early months of the year and mass fish deaths along the central coast in April from a pollution incident at a steel mill in Ha Tinh province. Agriculture and mining activities were especially hard-hit.

Inflation is targeted at 4 per cent in 2017. As at October, annual inflation stood at 4 per cent, moving closer to the 5 per cent target set for the year as a whole.

HSBC’s latest report, released in early November, put GDP growth for 2016 at 6.2 per cent and 6.5 per cent for 2017; lower than the government’s plan of 6.7 per cent. Inflation is expected to surpass 4.5 per cent in 2017, 0.5 per cent higher than the government’s plan.

Public debt is set to reach 64 per cent of GDP this year, but the NA has expressed qualms about public debt breaching its ceiling of 65 per cent of GDP if growth falls short of its target. According to HSBC figures, Vietnam will see public debt surpass the ceiling and stand at 66.2 per cent of GDP this year and 66.4 per cent next year.

Vietnam targets economic growth in the final quarter of this year of 7.1-7.7 per cent, which if reached would help the country achieve full-year growth of 6.3-6.5 per cent, government spokesman Mai Tien Dung told a recent press conference.

Lower GDP is expected to push the country’s public debt ratio closer to the ceiling of 65 per cent of GDP and pose more challenges for Vietnam’s already tight State budget, Prime Minister Nguyen Xuan Phuc said in an address to the NA in October.

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