Vietnam’s economy expanded more than 6 percent for a second year, defying a regional slowdown to remain one of the world’s best performers as manufacturing rose.
Gross domestic product increased 6.68 percent in the fourth quarter from a year earlier, up from 6.56 percent in the previous three months, the General Statistics Office said in Hanoi Wednesday. The economy grew 6.21 percent in 2016, compared with the median estimate of 6.3 percent in a Bloomberg survey.
“Although there has been no breakthrough in GDP growth in 2016, it was still a success as the figure is relatively high and stable,” Nguyen Bich Lam, director of the GSO, told reporters in Hanoi.
He blamed the tempered growth on fragile global economic conditions, a punishing regional drought and a toxic leak in central Vietnam that devastated the local fishing and tourism industries earlier this year.
Vietnam ranks among the world’s fastest-growing economies as its exports remained resilient to a global trade slowdown that’s hurting Singapore and China. Companies setting up plants in the country, such as Samsung Electronics Co., are transforming the nation into a manufacturing hub for electronics goods, including smartphones. The Asian Development Bank forecast Vietnam’s economic growth at 6.3 percent in 2017.
The Southeast Asian nation has increasingly become a regional magnet for private investment, especially in its growing manufacturing and consumer sectors.
Analysts have hailed it has a bright spot in the region.
Neighboring Thailand, once the star of Southeast Asia, has by contrast seen its economy stagger under a military junta.
“Vietnam is in a sweet spot right now,” said Frederic Neumann, co-head of Asian economic research at HSBC Holdings Plc in Hong Kong. “Strong growth will persist in the next several years. It is continuing to gain market share in exports and even giving China a run for competitiveness. Foreign companies continue to invest in Vietnam to take advantage of its highly competitive labor and low cost. The outlook is bright and it is one of the standout economies in Asia.”
Manufacturing gained 13.61 percent in the fourth quarter from a year earlier, fastest pace this year, Ha Quang Tuyen, head of GDP department at the GSO, said at a briefing on Wednesday.
Exports rose 8.6 percent in 2016, imports gained 4.6 percent, according to GSO. Vietnam posted a trade deficit of $300 million in December. It had a trade surplus of $2.68 billion for 2016.
Retail sales rose 10.2 percent in 2016. Disbursed foreign direct investment climbed 9 percent to a record $15.8 billion this year. Pledged FDI increased 7.1 percent.
An analysis published by the World Bank earlier this month said strong domestic demand and export-oriented manufacturing gave the country’s economy a favorable outlook.
It also hailed low inflation rates, which the government said Wednesday were kept below its target five percent.