Production activities at a foreign-invested enterprise in Dong Nai. (Photo: Hong Dat/VNA)
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IMF says Vietnam remains an attractive destination for foreign direct investment (FDI) amid global economic fluctuations and geopolitical uncertainties.
Despite the common difficulties of the global economy, Vietnam recorded a growth rate of 5.66% in the first quarter of 2024, according to Mr. Paulo Medas, head of the IMF’s Vietnam Macroeconomic Advisory and Surveillance Mission.
Exports of goods continued to grow strongly, supporting overall growth. However, domestic demand, especially personal consumption, is weak and poses a potential risk to the economy.
The IMF forecasts that Vietnam could reach a growth rate of nearly 6% in 2024, thanks to the recovery of domestic demand and the government’s supportive fiscal policy.
However, the IMF also recommends that Vietnam adopt a flexible fiscal policy to cope with risks and ensure sustainable growth.
In the context of rising inflation due to global fluctuations, the IMF believes that Vietnam may need to increase interest rates to contain price pressures. However, monetary policy adjustments need to be implemented cautiously to avoid negative impacts on growth.
Mr. Medas assessed that amid the shift of supply chains to Asia, Vietnam continues to be one of the attractive destinations attracting large amounts of FDI thanks to its stable investment environment, high economic growth, large domestic market, and young workforce.
Kieu Trang-Hong Nguyen-Dao Lam
