10:07 | 23/10/2015 Economy- Society
The Vietnamese economy will likely expand more than 6% annually over the next few years thanks to continued export resilience and ongoing reform measures by the government to improve the country's business environment, according to BMI research firm.
Containers are loaded at Tan Cang - Hiep Phuoc Port in Ho Chi Minh City (Photo: VNA)
In the latest study in October, BMI research, a Fitch Group company, forecast gross domestic product (GDP) growth will accelerate to 6.4% in 2015, an increase of 0.4 percentage points, compared to 2014 and for the economy to grow in excess of 6.0% in real terms over the coming years.
BMI maintains a "positive outlook" on Vietnam's economy due to rising foreign investor interest, continued efforts by the government to improve the country's business environment, and the potential for greater private sector participation.
The country has made substantial efforts to establish itself as a key logistics hub in the Greater Mekong region, and consequently has reduced bureaucracy to attract investment. Specially, firms have benefited from a gradual reduction in tariff and non-tariff trade barriers, increasing the competitiveness of local producers compared to other regional producers.
Regarding the labour market, the study observed that Vietnam offers a number of notable advantages to firms including a high rate of literacy and an increasingly skilled and well-educated graduate population.
These advantages allow companies to access a competitive and available workforce.
Besides, Vietnam also has strong potential in the construction and real estate sectors. With the easing of regulations on property ownership for foreigners taking into effect since July of 2015, foreign investors can engage more deeply in the housing market and Vietnam.
Meanwhile, loose monetary policy and lower inflation will boost the construction and real estate sector in the future.
With regard to foreign direct investment (FDI), the study found out that Vietnam will attract more FDI in the next quarters thanks to the great effort of the government to stabilise the the economy. In addition, the Vietnamese Government has sent a strong message to investors that Vietnam will accelerate the process of equitisation of State owned enterprises.
This reform will improve the banking system, as well as reallocate many resources for the private sector./.