The car assembly factory of the Truong Hai Auto JSC in the Chu Lai Open Economic Zone in Nui Thanh district, Quang Nam province (Photo: VNA)Singapore (VNA) – Vietnam’seconomy recovered in the third quarter, but growth has come in slightly weakerthan what Singaporean economists have expected.
The country’s gross domestic product (GDP) in the third quarter rebounded 2.6percent year on year, compared with 0.4 percent seen in the previous quarter,falling short of private sector economists’ expectations of 2.7 percent growth.
The recovery pace remains weak after the interruption from a temporaryresurgence of COVID-19 cases in Da Nang city in late July, said the UnitedOverseas Bank’s head of research Suan Teck Kin, adding the authorities haveregained control of the situation and businesses activities are back on track;however, they are still below “normal”.
Maybank Kim Eng economists Linda Liu and Chua Hak Bin noted that Vietnam hasescaped a recession amid the pandemic this year, but recovery has been dampenedby the emergence of a "second wave".
Suan said while the worst of the impact from COVID-19 appears tobe over, as is the case for other Asian countries, it is still "a longway" before Vietnam's economy could return to full capacity.
So far, data has shown an "anemic recovery" for theindustrial and services sector, which account for more than 70 percent ofVietnam's economy, he said. At the same time, the services sector, which isheavily reliant on inbound tourism, has been hit by border closures around theworld and could continue being in "a dismal state" for some time, headded.
He is expecting recovery to extend further in the fourth quarter, but with arestrained pace due to the ongoing pandemic, predicting a 4 percent growthin Q4 and for full-year expansion to come in at 2.8 percent.
Maybank Kim Eng economists lowered their forecast for the fourth quarter from6 percent to 4.5 percent, and for full-year growth to come in at 2.9percent instead of 3.6 percent, as the recovery momentum appears to be losingsteam.
They said that the industry and construction sectors will continue to leadthe recovery, while services will trail due to softer demand and the lack of ameaningful tourism recovery.
However, they said better recovery will be in the retail sales,which grew from 3.6 percent in August to 4.9 percent in September. This means non-tourism-relatedservices are starting to catch up./.
VNA
