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Friday, July 19, 2024

HCMC likely to fall short of 2023 GRDP growth target

The Saigon Times

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HCMC – HCMC’s gross regional domestic product (GRDP) is projected to approach 7% this year if the second half proceeds smoothly, according to HCMC Chairman Phan Van Mai.

He made the statement during a meeting yesterday on HCMC’s socioeconomic performance in the first half of 2022 and prospects for the second half held on June 29.

The municipality has set a GRDP growth target of 7-8% for 2023. However, slow growth in the first half of the year makes it hard to achieve this task, according to the city’s chairman.

Le Thi Huynh Mai, the director of the HCMC Department of Planning and Investment, backed the view, citing that the city’s economy is still in the process of recovering from the impact of the Covid-19 pandemic and remains susceptible to global economic fluctuations, as well as the implementation of tight monetary policies by major economies.

In the first quarter of this year, HCMC’s economy saw a modest expansion, with a growth rate of only 0.7%, the lowest among the five centrally-governed cities. However, there was notable acceleration in the second quarter, thanks to strong performance in public investment and the service sectors.

As a result, the city’s GRDP reached 5.87%, leading to an overall growth rate of 3.55% for the first half of the year.

As of June 29, HCMC had disbursed VND14 trillion, achieving 21% of its full-year public investment plan. Chairman Mai noted that while the disbursement rate had not reached the planned 35%, it still marked a significant improvement compared to the VND6 trillion disbursed in the same period last year.

Tran Du Lich, a member of the National Assembly Economic Committee, stated that the city’s economy bottomed out in the first quarter and remains challenging. However, the business landscape has significantly improved, with HCMC’s GRDP in the second quarter surpassing the national average gross domestic product (GDP).

Lich added that the National Assembly’s Resolution 98 could contribute to a potential jump in HCMC’s GRDP growth to 8% in the second half of the year. However, he emphasized that this alone would not suffice to help the city achieve its economic growth target.

The HCMC Institute for Development Studies (HIDS) reported notable economic improvement in the city. Industrial production, tourism, accommodation, and catering services have rebounded strongly, while consumer demand has shown positive growth in the second quarter.

Despite these positive factors, achieving the GRDP growth target of 7.5-8% remains challenging, according to Pham Binh An, Deputy Director of the HIDS. To reach a growth rate of 7.5% in 2023, the third quarter needs to achieve a growth range of 11.31% to 15.35%, while the fourth quarter should fall between 7.98% and 11.89%. Similarly, to meet the 8% target, the third quarter’s GRDP must grow between 12.8% and 16.0%, and the fourth quarter between 9.35% and 12.45%.

Vietnam’s economy grew 4.14% in the April-June period from the same time a year earlier, picking up from an expansion of 3.3% in the first quarter but still slower than the pace of previous upswings as export demand loses steam. This resulted in an overall growth rate of 3.72% for the first half of the year.

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