Hanoi - International analysts in recent days have presented wildly varying estimates for Vietnam's 2009 GDP growth, but local economists said Wednesday they were not worried. "The global situation is volatile, and international experts cannot forecast the current situation," said Tran Dinh Thien, director of the Vietnam Institute of Economics. "So how can they do that for Vietnam?"
At a business roundtable that concluded Wednesday, the only thing economic forecasters could agree on was that the government's growth target for 2009 was too optimistic.
Justin Wood, director of The Economist Intelligence Unit's Southeast Asia Corporate Network, forecast growth for 2009 at just 0.3 per cent, down from 6.2 per cent last year.
Lim Chuan Poh, CEO of Singapore Telecommunications International, said growth would likely come in at 3 per cent. JP Morgan Chase Chief Economist David Fernandez agreed with an International Monetary Fund forecast that put growth at 5 per cent.
All the estimates were lower than the official government target of 6.5 per cent.
"Lack of information about Vietnam's economy is the main reason for the different estimates," said Tran Duc Nguyen, former head of the Prime Minister's Research Commission, an economic advisory council that was abolished in 2006. "If they had sufficient data, the figures would not be varying by a factor of twenty times."
Nguyen said The Economist Intelligence Unit's low estimate was due to excessive reliance on Vietnam's export economy, not domestic demand, which he claimed constituted a large portion of Vietnam's GDP.
According to official statistics, however, exports account for 70 per cent of Vietnam's GDP.
The economists also said they felt GDP growth was overrated as a measure of economic well-being.
"The government should not devote all its efforts to achieving high economic growth, but should pay attention to the quality of our growth," Thien said.
"Emphasizing the rate of economic growth is very biased," Nguyen said. "It does not help to raise the quality of people's lives."
Since the 1990s, Vietnam's government has championed the success of its "doi moi" policies of economic reform in delivering greater wealth to its people. The country cut its poverty rate by more than half between 1991-2005, and per capita income topped 1,000 dollars per year in 2008.
Economists warn that falling export revenues due to the global economic slowdown are leading to large-scale layoffs and threatening the government's ability to raise enough revenue to meet its budget needs.
Some observers worry that economic setbacks may lead to rising social and political tension.
