HANOI, April 24 (Xinhua) -- Vietnam is projected to post economic growth of 6.6 percent in 2019, driven by credit tightening, slower private consumption and weaker external demand, the World Bank in the country on Wednesday quoted the bank's latest report on economies in East Asia.
Inflationary pressures facing Vietnam are projected to remain moderate this year, due to subdued global demand conditions and moderate global energy and food prices, according to the World Bank's East Asia and Pacific Economic Update April 2019.
"Over medium term, growth is projected to stay around 6.5 percent, as the impact of current cyclical uptick dissipates. Poverty is expected to decline further, as labor market conditions remain favorable," stated the bank's report.
Despite improved short-term prospects, there are significant downside risks. Domestically, a slowdown in the restructuring of state-owned enterprises and banking sector could adversely impact the macro-financial situation, undermine growth prospects, and create public sector liabilities, according to the World Bank.
A continued slowdown of public investment could undermine long-term development objectives, and further fiscal consolidation should focus on containing recurrent spending while stabilizing revenue performance.
"Vietnam's economy also remains susceptible to further volatile developments in the global economy, given its high trade openness and relatively limited fiscal and monetary policy buffers. Weaker external demand and heightened global financial volatility call for a continued focus on sound macroeconomic management to safeguard against possible shocks," stated the report.
Vietnam's gross economic product (GDP) is forecast to grow 6.8 percent in 2019 and 6.7 percent in 2020, the Asian Development Bank said in its report "Asian Development Outlook 2019" released early this month.
Vietnam, which gained GDP growth of 7.08 percent last year, up from the annualized target of 6.5-6.7 percent, made GDP growth of 6.79 percent in the first quarter of this year, according to its General Statistics Office.
The country's top legislature has set a target of attaining GDP growth of 6.6-6.8 percent in 2019.