the Pacific in general is robust, said the World Bank in its latest
East Asia and Pacific Economic Update.
The WB Update was announced at a press briefing in Hanoi on Oct. 19.
According to the Update, Vietnam ’s economy has recovered strongly
with a GDP growth of 5.3 percent in 2009 and is on the way to the
target of 6.5 percent this year. The nation’s foreign investment rose
from 6.9 billion USD in 2009 to 7.6 billion USD in 2010.
In addition, manufacturing companies’ relocation of plants in Southeast
Asia is benefiting Vietnam as its workers’ salaries are low and its
sea-bordered position is favourable for attracting investment capital.
The Update notes that output has recovered to above
pre-crisis levels throughout developing East Asia, and is expanding at
near pre-crisis rates in some countries. Real GDP growth is likely to
rise to 8.9 percent in the region in 2010 (6.7 percent excluding China
), up from 7.3 percent in 2009 and in line with the average growth
rate during the 2000-2008 period. Private sector investment is once
again driving growth, confidence is on the rise, and trade flows have
returned to pre-crisis levels.
Yet, greater confidence
in the region's growth prospects and concerns about tepid economic
expansion in advanced economies is creating the need for policymakers to
perform a delicate balancing act -- in particular, around the return of
large capital inflows and appreciating currencies.
"Should inflows remain strong, especially against a background of weak
global growth, the authorities will be faced with the challenge of
balancing the need for large capital inflows -- especially foreign
direct investment -- with ensuring competitiveness, financial sector
stability, and low inflation," said Vikram Nehru, World Bank chief
economist for the East Asia and Pacific region.
The East
Asia and Pacific Update which is published twice yearly is the WB’s
comprehensive review of the region’s economies./.
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