Illustrative image (Source: VNA) Hanoi (VNA) - The Vietnamese Government has succeeded in decreasing public debtfrom 53 percent of GDP in 2016 to 50.5 percent by the end of last year,according to Fitch Ratings.
Reportingat a workshop to assess Vietnam’s economic prospects amid macro challenges jointlyheld by Fitch Ratings and the Asset magazine in Hanoi on June 11, representativesfrom the US-based rating agency mentionedthe factors for this organization to decide to lift its outlook on Vietnam's 'bb' credit rating to'positive' from 'stable'.
TheGovernment of Vietnam continues to drastically realise its commitment toconsolidate its finance sector and control public debt, they said.
Thisorganisation forecasts that Vietnam's public debt will continue to be broughtdown to about 46 percent of GDP by 2020.
Fitchpredicts that Vietnam will continue to receive a large amount of foreign directinvestment (FDI) into the manufacturing sector, mainly in electronics segmentthanks to its advantage of low cost and supply chain connectivity.
These positive trends will support stable short-term economic growth, althoughthe global economic situation is weakening and Vietnam's high level of tradedependence can affect economic growth in 2019 and 2020, it said.
This leads Fitch to predicting that Vietnam's economic growth will decreaseslightly from 7.1 percent in 2018 to 6.7 percent this year and the next.
This figure is still in the 6.6-6.8 percent growth target set by the NationalAssembly, and Vietnam will continue to be one of the fastest growing economiesin the Asia-Pacific region, it stressed.
Speaking at the event, Vo Huu Hien, deputydirector of the Finance Ministry's Department of Debt Management and ExternalFinance, said the prospects of Vietnam's economy in 2019 and2020 will remain positive, with macroeconomic stability, and confidence ininvestment and business environment continuing to be strengthened.
However, Hien also mentioned outside challenges that Vietnam's economy isfacing, saying that the US-China trade war will also have certain impact onVietnam's economy.
Healso expressed his hope that Vietnam's credit rating in the coming time willcontinue to be improved, thus further lifting the national prestige, reducing thecost of raising capital, facilitating market access through strengthening theability to attract investors.-VNA
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