While growth is set to ease in 2019, Vietnam will still be among the top 10 fastest-growing economies globally, according to a report recently released by the Institute of Chartered Accountants in England and Wales.
In the “Economic Insight: South-East Asia” report, the institute predicts that economic growth across Southeast Asia is expected to slow down in 2019 to 5 percent, after an estimated 5.3 percent in 2018. It attributed the slowdown to US-China tensions.
Economic growth continued to moderate across most Southeast Asian economies in the third quarter of 2018, with the average GDP growth slowing to 4.8 percent year-on-year, from 5.2 percent in second quarter of 2018, it said.
Vietnam was the exception, with GDP growth accelerating 6.9 percent on the year, up from 6.7 percent in the second quarter as FDI inflows continued to support growth in manufacturing activity and exports.
Many governments in the region, including Indonesia and Malaysia, are expected to miss their ambitious fiscal consolidation targets for 2019.
In Vietnam, while the Government’s fiscal position has improved, there is limited space for any expansionary fiscal policy next year, the report said.