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HCMC’s economic picture in first 6 months of 2024 

 Tuesday, July 9,2024

AsemconnectVietnam - Although Ho Chi Minh City's economy faces many difficulties and challenges, it has recorded positive signs.

The economic picture of Ho Chi Minh City in the first 6 months of 2024 has seen many improvements, growing by 6.46% over the same period, higher than the country's overall growth rate of 6.42%.
Reported at the regular meeting on the socio-economic situation in the first 6 months of the year; key tasks and solutions for the last 6 months of 2024, Ho Chi Minh City People's Committee said that in the first 6 months of 2024, Ho Chi Minh City's economic growth reached 6.46% over the same period last year, higher than the country's overall growth of 6.42%. This is also higher than the increase of 3.55% in the first 6 months of 2023.
The trade and service sector contributed the most with 4.34 percentage points, and also had the highest growth rate among the regions, reaching 7.26%.
Another noteworthy point is that the industrial production index (IIP) in the first 6 months of 2024 in Ho Chi Minh City increased by 5.6% over the same period last year. This is the highest increase in the last 3 years.
In addition, the total retail sales of goods and consumer service revenue in the first 6 months increased by 10% over the same period last year. Of which, retail sales of goods increased by 10.2%, accommodation and dining increased by 8.1%, travel services increased by 63.3% and other services increased by 7.2% over the same period last year.
The total export turnover of the city's enterprises through border gates nationwide in the first 6 months of 2024 was estimated at 22.56 billion USD, up by 13.1% over the same period last year. In contrast, the total import turnover of the city's enterprises through border gates nationwide was estimated at 27.5 billion USD, up by 4.6% over the same period last year.
Ho Chi Minh City has assigned and allocated detailed annual public investment capital plans of nearly 79,264 billion VND. According to the data from the Ho Chi Minh City State Treasury, as of June 21, the city's total annual public investment plan has disbursed nearly 8,195 billion VND, reaching 10.3% of the total assigned capital plan. It is estimated that by the end of June, the disbursement was estimated to reach 15.7%.
Businesses are going through difficult times
Ho Chi Minh City Business Association (HUBA) said that the results of the business survey in the second quarter of 2024 showed that most businesses are operating stably at a rate of 57.1%, an increase of more than 6.0% compared to the first quarter of 2024.
The specific situation of the enterprise through reports of professional associations and clubs recorded positive signals such as: the textile and garment production sector began to receive orders again until the end of the year due to efforts to find new markets and digital transformation, green transformation, offering competitive prices.
The field of processing and exporting agricultural products: rice, seafood, fruit, etc. grew relatively better due to the boom of the Chinese market and changes in consumer tastes. In particular, the food processing industry has many favorable market conditions, so it has achieved very encouraging results.
The cumulative export turnover of food industry products in the first 5 months of 2024 reached over 2 billion USD, an increase of nearly 70% over the same period of 2023 and accounting for nearly 20% of the City's total export turnover. In particular, the group of domestic enterprises accounted for the main proportion (93.5%) compared to FDI enterprises with export turnover reaching 1.29 billion USD. The industrial production index of the food processing industry grew by over 3.4% compared to 2023.
However, according to Mr. Nguyen Phuoc Hung, Vice Chairman of HUBA, the number of businesses with reduced revenue increased to 30.4%. Meanwhile, the amount of inventory increased to 34.0% and the debt balance increased to 42.0%, a sign that the market is gradually deteriorating, it is more difficult for businesses to sell goods than before and the situation of outstanding debt is increasing commonly in the community.
In particular, the labor index showed that many businesses are planning to reduce labor by 30.0%. Although this is an extremely difficult decision, affecting the future development of the business, the harshness of the market has caused some business owners to use the most negative tools.
In the field of construction materials business, from the beginning of the year until now, many agents have not taken new orders, because purchasing power has decreased and civil construction projects have not revived. Businesses face many difficulties, lack cash flow, and are unable to repay debt. Meanwhile, foreign businesses use raw materials at much lower prices than domestic businesses, creating low-cost products, making it difficult for domestic businesses to compete.
Real estate businesses, despite receiving significant support from the State, continue to face more difficulties than other industries, due to previous investment mistakes with large loans, lack of cash flow and high interest rates.
Therefore, for Ho Chi Minh City's economy to continue to recover in the second half of the year, businesses believe that Ho Chi Minh City needs to continue to improve institutions and policies to quickly remove difficulties, obstacles and free up resources; ready to enforce the Land Law, Housing Law, Real Estate Business Law, and Credit Institutions Law.
At the same time, with the contribution of service trade, Ho Chi Minh City needs to continue to stimulate consumption demand and connect local trade. In the online environment, authorities promote connection and data sharing to serve the development of e-commerce and prevent tax loss.
CK
Source: VITIC/ haiquanonline.com.vn

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