Unhealthy local economy is well on road to recovery

In this year’s first eight months, many industrial sectors witnessed significant on-year production growth, like telecommunication equipment (64.1 per cent), vehicle component (43.8 per cent) and electronic spare-parts (29.1 per cent). Also, more than 6,100 enterprises were established in August, up 3.32 per cent on-month, with total registered capital of VND73.6 trillion ($3.54 billion), up 161.33 per cent on-month.

And the number of enterprises closed and stopped operations reduced by 3.1 per cent on-month to 5,141. Meanwhile, the total retail and service sales value increased 0.7 per cent on-month in August compared to only 0.1 per cent in July. Total import turnover in August was estimated to be $10 billion, up 3.5 per cent against July.

Japan International Cooperation Agency vice president Hiroto Arakawa last week told MPI deputy minister Cao Viet Sinh he was upbeat about Vietnam’s existing macro-economic figures and the government’s macro-monitoring.

"Japanese investors are optimistic about Vietnam’s economic prospects. Amid the global economic crisis, such figures show the government’s economic achievements,” Arakawa said.

Sinh said that the most economically difficult period had elapsed and local production has been gradually recovering.

Vietnam Automobile Manufacturers’ Association said its 18 member companies’ sales had risen since June. In July, they sold 7,433 vehicles, up 13 per cent from June. Specifically GM Vietnam’s sales rose from 262 in June to 471 in July, while the respective figures for Mercedes-Benz Vietnam were 155 and 200, and for Toyota Vietnam were 1662 and 1727, and for Ford Vietnam were 437 and 470.

According to Global Intelligence Alliance’s Business Perspectives on Emerging Markets 2012-2017 online survey conducted in April-May 2012 amongst business managers at 431 large and mid-sized companies and organisations worldwide, Vietnam was ranked seventh in the world’s top 30 emerging economies. The country is favoured amongst consumer and retail, logistics as well as energy and resources industry players.

MasterCard Worldwide Index of Consumer Confidence for 2012’s first half released in mid-August said consumers in Vietnam were the most optimistic about the country’s economic outlook, with 77.2 index points.

"Despite concerns over the troubled global economy around the world and a challenging business environment closer to home, we are anticipating rapid trade growth in Vietnam over the next 15 years. HSBC’s Global Connections Report [released in July, 2012] estimates total trade will rise to the tune of around 187 per cent between now and 2026,” said Huynh Buu Quang, head of HSBC Vietnam commercial banking.

"Confidence amongst Vietnamese international businesses remains stable, and relatively high. Indexed scores of 116, 115 and 115 have been recorded since 2011’s half,” said the MasterCard report.