The IMF forecasted that US economic growth (as Vietnam’s largest export market) in 2019 could fall to 2.5% and even lower by 2020. However, according to the report: Vietnam Economic Annual Review 2018 from Vietnam National Economics University, this growth rate would be still considered higher than the potential output of the US economy.
The report also said that Chinese economy was expected to grow slower for next several years, could be at 6.3% in 2019 and 6.4% by 2020. In fact, Chinese government had been taking initiatives in their monetary policies, however, the impacts from China-US trade war and their tightening on financial and banking regulations would certainly have some negative impacts on China – a large export market of Vietnam.
In Asia, Japan was reported by IMF to grow at 1.1% in 2019. This increase reflects a confidence on Japan’s fiscal policies implemented throughout 2018, even a consumption tax increasing plan would take place by October 2019.
In Southeast Asia, the ASEAN-5 group was expected to grow at 5.1% in 2019 and 5.2% by 2020. This increase is only slightly reduced compared to the previous period which mainly reflects risks from exchange rates as well as unusual changes from international investment flows.
In European region, it was about 1.6% in 2019 and 1.7% by 2020, lower than the previous period. Those major economies of European Union such as Germany, Italy and France could face certain difficulties, mainly from weak growth of domestic demand and their political instability.
World trade growth in 2019 was forecast by the IMF at 4%, down by 0.2% compared to 2018, mainly due to the impact of trade wars between big countries such as US-China trade war which could be likely to keep continuing for next several years, this could push many countries tend to multilateralize their economic and trade links in order to avoid reliance on some major markets.