The above assessment was made by the National Financial Supervisory Commission (NFSC) in its latest report on Vietnam’s economic situation.
According to the commission’s analysis, in the context of the negative growth of the mining industry, the manufacturing and processing sector has become the driving force of industrial production, which has been increasing for many years.
Accordingly, the index of industrial production (IIP) in the first ten months of the year increased by 8.7% over the same period last year, higher than the level of 7.3% of the same period in 2016 and reached its second highest level in five years.
In particular, the manufacturing industry continues to be the main driver of industrial production, up 13.6% over the same period last year (11% over the same period of 2016).
In the opposite direction, mining growth remained negative (the first ten months fell by 7.4% over the same period of 2016). However, the decline has improved significantly compared to the previous quarters.
In the context of high economic growth, the NFSC also stated that the Purchasing Managers' Index (PMI) had positive movements, reaching 51.6 points in October, continuing to maintain the 23rd consecutive month of gaining over 50 points.
Aggregate demand remained stable thanks to relative high consumer demand, while trade surplus continued to increase due to a sharp increase in exports and the disbursement of State budget investment in the fourth quarter.
The total retail sales of consumer goods and services in the first ten months of this year (excluding the price factor) increased by 9.4% over the same period last year, higher than the 9% rate in the same period of 2016.
In addition, consumer demand continues to improve markedly, beginning in Q3 of 2017. The trade balance in October continued to enjoy a surplus of approximately US$900 million, contributing significantly to improving the aggregate demand. As a result, the trade balance in the last three months has reached a trade surplus of US$3.76 billion, resulting in a ten-month trade surplus of US$1.23 billion.
However, the commission noted that, while the FDI sector posted US$17.63 billion in the first ten months this year, the domestic economic sector only earned US$16.4 billion. This situation continues to show the dependence of trade and economic growth on the FDI sector.