Vietnam’s credit rating improved
Fitch Ratings has increased Vietnam’s long-term foreign-currency issuer default rating to BB
Based on good results coming from rising foreign-exchange reserves and strong economic growth, Fitch Ratings, one of the world’s three biggest credit rating agencies, has risen Vietnam’s credit rating. According to Bloomberg: “The rating on the nation’s long-term, foreign currency-denominated debt was raised one level to BB, with a stable outlook”.
In addition, according to the recent positive socio-economic results, such as reforming state-owned enterprises, containing debt, strong foreign-investment levels and thriving manufacturing sector, Fitch is forecasting Vietnam’s GDP growth at 6.7% for 2018 (a similar result to 2017). This will allow Vietnam to remain one of the fastest-growing country in Asia-Pacific region in 2018.
2010 - 2017 Vietnam’s GDP growth (Vietnam's General Statistics Office, via Bloomberg)
- 2010 -- 6.3%
- 2011 -- 6.2%
- 2012 -- 5.3%
- 2013 -- 5.4%
- 2014 -- 6.0%
- 2015 -- 6.7%
- 2016 -- 6.2%
- 2017 -- 6.8%
The latest data shows that the national reserves are expected to rise to about $66 billion by the end of 2018, up from $49 in 2017. In addition, government debt is on the way to go lower than 50% of GDP, by 2019, while budget deficit is estimated to be 4.6%, almost identical to last year’s 4.7%.
Original sources (1, 2)