ADB's Asian Development Outlook (ADO) 2018 was announced on April 11, 2018, in Hanoi

According to Aaron Batten, Senior Country Economist at the Asian Development Bank, Vietnam’s economic growth will see a spurt this year, making the country one of the strongest performers in the Asia-Pacific region. Vietnam’s inflation is expected to reach 3.7% this year and 4% in 2019.

“We see 5 main reasons why Vietnam’s growth will be slightly higher than what it was last year. The first is related to foreign investment. We see indication of that already in Q1, 2018. FDI disbursement reached 3.8 billion USD in the first quarter of this year which is up 7.2% year on year. We broadly expect that trend to continue based on the strong commitments that we received last year in Vietnam. The second major driver of growth we expect to see this year is the continued vigor expansion as mentioned by the ADB Country Director. The 4^th major factor that we see driving growth this year is the business environment and jobs. Vietnam last year moved up 14 places in terms of the World Bank’s Doing Business Survey Indicator. The final cause that are highlights is related to the agricultural sector. We see that the agriculture, forestry, fishery grew by 4% in the 1^st quarter of 2018 which is more than double the pace that was recorded in the 1^st quarter of last year. So ADB broadly sees a rather optimistic picture for Vietnamese groth over the next 2 years.”, said Mr. Batten.

The report says Viet Nam has an abundance of efficient labor working for relatively low wages. This attracts large FDI inflows especially for labor-intensive export-oriented manufacturing. However, a skills gap is emerging as an obstacle to FDI absorption and to business more generally.

The ADB suggests that Viet Nam prioritize three sets of initiatives toward strengthening its universities and its technical and vocational education and training (TVET) system: expanding access, improving quality, and streamlining governance.