Bouyant FDI supporting economic recovery in Vietnam

HO CHI MINHI CITY - Buoyant FDI continues to support recovery. As of August 20, registered FDI reached US$12.6 billion, soaring 19.5% from a year earlier. This was backed by 768 new projects mostly focussing on the manufacturing sector. Meanwhile, FDI disbursements edged up 3.8% y-o-y to US$ 7.6 billion, and became a key factor contributing to a marked improvements in production activity.

In its monthly assessment, Vietnam Asset Management (VAM) says that while the employment index for the manufacturing sector in SOEs and the private sector showed negative growth, that in FDI sector increased by 5.6% y-o-y. FDI enterprises also continued to be the main driving force in pushing exports, foreign-invested firms contributing more than 60% of total exports. YTD export turnover advanced 14.7% y-o-y as of end-August.

Inflation in Vietnam remains under control. The August edged up just 0.83% m-o-m, lifting the headline CPI to 7.5% y-o-y, from 7.29% in July. VAM says that, eight months into 2013, the economy has started showing some modest improvements, with the Government’s inflation target likely to be met, while more affordable borrowing costs are supporting production activities and making the business environment more attractive. www.vietnamam.com (ATI).