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HCMC reports strong growth in Q1 but challenges persist

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HCMC – HCMC’s gross regional domestic product (GRDP) in the first quarter of this year surged by 6.54% year-on-year, above earlier expectations. But municipal authorities expressed caution, citing ongoing challenges.

During a meeting held on April 2, participants reviewed the economic performance of the city in the first quarter and discussed action plans for the second quarter.

Various economic indicators demonstrated significant improvement. Retail revenue from goods and services picked up by 12.2% to VND270.2 trillion. Tourism revenue rose by 23.8%.

January-March exports leapt by 7.5% year-on-year to US$10.1 billion, while import spending edged up by 3.1% to US$13.1 billion. The index of industrial production (IIP) expanded by 5.1%, the highest in recent years. First-quarter IIP grew by only 4.1% in 2021, 4% in 2022, and dropped 0.8% in 2023.

Tax revenues improved by 7.6% over the same period last year, reaching 28.7% of the annual target, and the consumer price index remained stable.

Nguyen Nguyen Phuong, deputy director of the city’s Department of Industry and Trade, said that HCMC’s economy enjoyed strong growth in the first quarter, outperforming other centrally-run cities like Hanoi and Can Tho.

However, challenges persist despite the positive economic indicators. Credit growth remained slow, and foreign direct investment (FDI) inflows decreased by 7.61% year-on-year. The number of temporarily suspended businesses climbed by over 20%.

These indicators point to a slow economic recovery in HCMC, said Phan Van Mai, chairman of the HCMC People’s Committee.

“We need to get prepared for challenges and maintain growth momentum in the coming quarters in order to reach the 2024 target,” Mai added, quoting experts.

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