Vietnam’s economy expands unexpectedly

The economy of Vietnam has posted an unexpected 0.36% growth year-on-year, though the pace is slowest in at least a decade, as exports slumped because of the ongoing pandemic. Bloomberg data suggested the GDP to shrink 0.9%.

In the first quarter, gross domestic product saw a revised 3.68% growth, the General Statistics Office said Monday in Hanoi.

Vietnam recorded a trade surplus of $500 million in June, compared with a $900 million deficit the previous month.

Thus, despite blows to the export-reliant economy, the country is likely to be one of the better performers in Southeast Asia this year.

Prime Minister Nguyen Xuan Phuc said last month the economy could sustain growth of 4%-5% this year as the government looks to attract more foreign investment from businesses adjusting supply chains rooted in China.

The bad figures include 2% fall in exports in June compared to a year earlier, while imports climbed 5.3%. Consumer prices rose 3.17% in June from a year earlier, up from 2.4% in May. The government aims to cap average inflation at 4% this year.

Like China, Vietnam is also feeling Covid-19 shocks as the new virus disrupts global supply chains and hurts demand.