UOB Bank (Singapore) has just released the Economic Growth Report and the forecast for the next quarter for markets, including Vietnam.

The report maintains Vietnam’s 2022 GDP growth forecast at 6.5% and the main inflation rate at 3.7% in 2022. 

However, inflation may increase to 5% in 2023, due to facing many challenging risks, in which the Russia-Ukraine conflict lasts more than 100 days and the tension and sanctions are not yet available. signs of abatement. 

According to UOB, one of the optimism of the Vietnamese economy  is that the inflow of foreign direct investment (FDI) into Vietnam has increased somewhat in May. 

FDI attraction data of the Ministry of Planning and Investment shows that, in May, in contrast to the decline in newly registered capital, adjusted capital and contributed capital to buy shares of foreign investors continued to be the main pillars of the country. help in attracting FDI in the first months when both these sources of capital still increased strongly.

Accordingly, newly registered capital decreased by 53.4% ​​compared to the same period last year, but adjusted capital and capital contribution to purchase shares still increased strongly by 45.4% and 51.6% respectively, helping FDI capital to increase significantly. registration in the first 5 months of 2022 only decreased by 16.3% over the same period, down to 11.71 billion USD. 

The amount of registered FDI capital increased sharply in 2021 at 31.15 billion USD, which is also a factor affecting this year’s decline. 

According to the number of projects, Korea is still a partner with investors interested in and making new investment decisions as well as expanding investment projects and contributing capital to buy shares in the first 5 months of 2022. accounting for 19.4% of new projects, 33.9% of adjustments and 36.7% of times of capital contribution and share purchase.

On the consumer side, the lifting of domestic COVID-19 restrictions and the reopening of international tourism activities have given new life to the service sector. UOB expects tourism-dependent sectors such as accommodation and food to grow again in the second quarter of 2022, after nine consecutive quarters of decline.

"Based on the latest data as well as the difficulties ahead, we keep the GDP growth forecast for Vietnam in 2022 at 6.5%, in line with the Government’s plan of 6 - 6.5. %. 

The forecast is based on GDP growth in the second quarter of 2022 will reach 6% year-on-year and then increase to 7.6% in the third quarter of 2022," the UOB report stated.