REVIEW
of
FINANCE -
Feb. 2018
5
kept blooming in 2017. PMI witnessed a 25 months
of non-stop expansion in production. Specially,
there was a record of 54.6 points inMarch 2017. The
rise in PMI showed the improvements in business
environment in Vietnam production sector.
2017 aslo saw a significant improvement in
business registration. In fact, there were more newly
–registeredenterprisesandfewer temporarilyended
enterprises compare to last year. As of December
2017, the number of newly – registered enterprises
increased by 15% compared to that in 2016. The
average of one enterprise’s chartered capital also
increased by 26.2% worth 10.2 billion VND.
Compared to last period in 2016, as of December
1st 2017, the number of employees in industrial
enterprises in 2017 increased by 5.1%, in which
there was a cut of 0.7% in state owned enterprises
and a rise of 3.9% and 6.9% in non state owned
and foreign invested enterprises respectively. Also,
there was a reduction of 1.1% and 1% respectively
in employees in extractive industry and electricity
production and distribution industries.
Inflation was strictly controlled
In general, overall inflation in 2017 went down
strongly although there were increases in August
and September resulting from seasonal factors.
This completely contrasts the trendy non-stop rise
in 2016.
Last December, CPI rose by 2.60% compared to
that of the same period 2 years ago. Meanwhile,
core inflation has remained stable at a rate of 1.3%
since May, making a contribution to the smaller
and smaller gap between overall inflation and core
inflation.
Low inflation in 2017 mainly resulted from
was not significant. After FED decision of interest
increase, the gold price started rising.
Domestic economy recovered impressively
In 2016 Vietnam economy didn’t grow as
expected, however, 2017 witnessed a blooming
signal in Vietnam whose economic growth was
6.81%, higher than projected by the Parliament.
In particular, the economic growth in quarter III
and IV reached an impressive rate of 7.46% and
7.65% respectively, which were much higher than
that time in previous years and set a record after
7 years.
Agricultural, forestry, and fishery sectors
showed the most significant recovery of economic
growth which was 2.90%, much higher than the
growth rate in last two years. Fishery and forestry
increased by 5.54% and 5.14% respectively.
Meanwhile, floody rain in large areas resulted in a
modest growth of 2.07% in agriculture.
The growth rate of 7.44% in 2017 in service
sector fueled by the growth rate in 2015 in service
sector alsomade a great contribution to the national
economic growth. In particular, the highest rates
of 8.14% and 4.07% over the last years were
respectively the growth rates in finance, banking,
insurance and real estate trading.
As in previous years, 2017 again confirmed
the growth rate of 14.40% in manufacturing and
processing industry as a key to stimulate national
economic growth. Meanwhile, industry and
construction sectors kept showing a decreasing
growth rate of 8%, lower than that in last two years,
mainly resulting from the decline in extractive
industry. However, the decline in 2017 could not
slow down the national economic growth.
Industrial production indexes were improved
considerably throughout the year of 2017.
Especially, indexes of industrial production and
consumption both far exceeded the averaged
indexes in 2016. That means the decline in the
beginning of the year 2017 was temporary. As of
December 2017, the index of overall industrial
production increased to 9.4%, the highest index
over the last two years. Similarly, the consumption
index increased to 13.6% as of November 2017
while the conventory index slightly decreased to
8% in December 2017.
Enterprises, especially in processing industry,
2015 2016
2017
0%
2%
4%
6%
8%
10%
12%
Total
Agriculture,
forestry, shery
Industry,
construction
Service
6,7
6,2
6,8
2,4
1,4
2,9
9,6
7,6
8,0
6,3
7,0
7,4
FIGURE 1:VIETNAM’S ECONOMIC GROWTH
BY INDUSTRY 2015-2017 (%)
Source: General Statistic Office (2015, 2016, 2017)
