Viet Nam’s economy could grow between 6.9 and 7.1 per cent in the 2019-20 period under stable macroeconomic conditions that could boost foreign direct investment (FDI) and promote economic restructuring and the implementation of free trade agreements (FTAs).

The statement was made by Dang Duc Anh, head of the Analysis and Forecast Division at the National Centre for Socio-Economic Information and Forecast (NCIF) at a conference in Ha Noi on Wednesday.

However, Viet Nam faces risks in the upcoming period as economic growth becomes more dependent on the FDI sector. FDI enterprises in Viet Nam are focusing on a number of key commodities, so when there are trade disputes or conflicts, economic growth will be impacted significantly, Anh added.

In addition, credit growth and a high rate of money supply could lead to national debt and macroeconomic instability. High public debt and large repayment obligations also affect macroeconomic management as well as the possibility of reducing interest rates.

Meanwhile, the US trade deficit continues to rise; FDI flow from China is unclear; and bilateral and multilateral FTAs will have an increased impact on the Vietnamese economy, according to the NCIF representative’s forecast. — VNS