Vietnam has fully recovered from two years of Covid-19 impacts.
Lender HSBC has raised its growth forecast for Vietnam from 6.6 percent to 6.9 percent thanks to the country's broad-based recovery from two years of Covid-19 impacts.
Fading Omicron risks and easing of restrictions have set the basis for Vietnam's return to normalcy, with GDP growth in the second quarter hitting 7.7 percent year-on-year, a regional outperformer, the bank reported Wednesday.
Manufacturing continues to roar, with industrial production growth accelerated to over 25 percent year-on-year in the second quarter.
This helped export growth hit over 20 percent year-on-year in the second quarter.
However, the impact of high energy prices is becoming increasingly clear, HSBC said.
Elevated commodity prices have turned the trade balance into a deficit in the second quarter, likely exacerbating the deteriorating current account.
With surging energy prices considered, the bank trimmed its Vietnam growth forecast for 2023 from 6.7 percent to 6.3 percent.
Vietnams'GDP expanded by 2.6 percent last year. The government targets 6-6.5 percent this year.
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Việt Nam is focusing on global integration and has signed up for numerous free trade agreements, including one with the EU which facilitates exports between the two sides.
