VN's economy to grow at 6.7 per cent in 2022: Standard Chartered

Việt Nam's economy is predicted to bounce back strongly, growing at 6.7 per cent this year and 7.0 per cent in 2023, according to Standard Chartered Bank.

The global economy, meanwhile, has been forecast to grow at a 4.4 per cent rate this year, said Edward Lee, chief economist for ASEAN and South Asia at Standard Chartered Bank, against the 5.8 per cent growth rate in 2021.

High base effects, tighter monetary and fiscal policies, global supply-chain disruptions, and elevated inflation are expected to moderate the recovery momentum, following a strong bounce earlier in 2021 driven by initial vaccine rollouts and government stimuli were contributing factors.

Việt Nam's economic recovery should kick into high gear by the end of the first quarter of 2022, gaining momentum for the rest of the year as well as for the medium-term growth, said Tim Leelahaphan, economist for Vietnam and Thailand at Standard Chartered Bank.

Leelahaphan said he expected the South East Asian country to remain a key part of the global supply chain as rising wages in China, US-China trade tensions have compelled companies to relocate their production centres out of China or to opt for a China+1 strategy.

As this diversification process continues over the medium term, Việt Nam has a strong appeal to become an alternative manufacturing base.

Ben Hung, CEO for Asia at Standard Chartered Bank added: "The future of sustainability and our journey towards net-zero require joint efforts and collective action.

"Việt Nam is an important market in Standard Chartered’s Asia footprint and we are committed to investing in the country to help finance its sustainable development and secure greater economic prosperity.

“We will continue to connect Việt Nam with the world and provide sustainable finance to areas where it matters most. And we believe that the Government’s enhanced focus on greening the economy will offer businesses and investors increased confidence to invest more into Việt Nam’s sustainability agenda for the long term.”

Michele Wee, CEO at Standard Chartered Bank Vietnam commented, “The Vietnamese economy is now on a recovery trajectory. In our market research, our clients have told us that Việt Nam holds tremendous potential for growth and investment attraction.

"The country is playing an increasingly important role in international trade and the global supply chain. As a leading international bank in Việt Nam, we remain fully committed to supporting the country’s strong, sustainable recovery and growth in 2022 and the years to come.”

The recovery process was discussed at a forum in Hà Nội last week organised by the bank and Ministry of Foreign Affairs as part of the bank’s ongoing efforts to support the country's sustainable development process.

In November, the bank teamed up with the Ministry of Planning and Investment and the Embassy of Việt Nam in the UK to organise a conference in the UK with the Prime Minister of Việt Nam on securing a prosperous and sustainable future through private investment. As part of this event, the bank exchanged MoU worth US$8.5 billion with three Vietnamese businesses on projects to support their sustainability goals.

Aspiring to become the world’s most sustainable bank, it has set out its ambitious new targets to reach net-zero carbon emissions from its activities by 2050, including interim 2030 targets for the most carbon-intensive sectors. The bank also plans to mobilise $300 billion for green and transition finance by 2030.