Vietnam’s economic recovery trend continues to be maintained in the third quarter of 2014 with signs of faster transformation, Nhan Dan (People) online newspaper said in a commentary on October 1.

GDP growth rate in the period was estimated at 6.19 percent, higher than the 5.25 percent in the second quarter and 5.09 percent during the first quarter. GDP growth in this quarter is also higher than that of the same period two years ago.

For the first nine months of the year, the country’s GDP growth reached 5.62 percent, much higher than the rate of 5.14 percent in 2013 and 5.1 percent in 2012.

The figures show that, even under the adverse effects of both external and internal difficulties, the country’s economy continues to recover and regain growth momentum.

Manufacturing has been improved with industrial production index increased gradually each month and much higher than the same period last year. The nine-month period also recorded strong growth in the processing industry, manufacturing, service sector, and exports.

Along with the growth momentum, macro-economic stability has been maintained with higher quality. Inflation was held steadily at 2.25 percent, the lowest in the past 10 years despite the spike in the education group figure to 7.17 percent in September (the month students returned to school). Core inflation is in a downward trend from last year and dropped to 3.12 percent in September compared with the same period last year.

The State budget balance has been improved as budget collection progress was higher than the same period in 2013, up 17.2 percent and accounting for 81.3 percent of the estimated. The State budget deficit during the nine-month period made up 58.9 percent of the overspending that the National Assembly had allocated early this year. Vietnam also gained a trade surplus of 2.5 billion USD, contributing to national foreign currency reserves.

The positive economic development is remarkable, however, the economy still faces many difficulties and challenges threatening the economic growth target of 5.8 percent for the whole year. Aggregate demand has been improved, yet is still not strong enough to generate momentum for the economy, while the business community, an important factor to create economic growth, is also in difficulty.

The figure of dissolved or decommissioning enterprises remains high, up to 48,330 with a total registered capital of more than 408 trillion VND (19.2 billion USD), up 13.8 percent compared to the same period in 2013.

Inventory is still hard to solve for many businesses. Also due to production difficulties, business capital absorption capacity is at low level, leading to the low credit growth of 6.62 percent, about half of the yearly plan. Besides, bad debts have become a big challenge as the non-performing loan ratios of commercial banks are tending to rise again.

Clearly, the economic growth target of 5.8 percent this year will not be easily achieved if difficulties and challenges mentioned above are not solved in a timely, comprehensive and effective manner. Fulfilling the goal will pave the way for maintaining economic recovery momentum in the coming year.