The Economic Intelligence Center of Siam Commercial Bank (SCB EIC) of Thailand reported on February 1 that CLMV countries including Cambodia, Laos, Myanmar and Vietnam will achieve growth momentum stronger in 2023 but still below its pre-COVID-19 growth potential.
The SCB EIC report suggests that the recovery will be uneven across countries, depending on economic fundamentals and country-specific risks.
SCB EIC forecasts that Cambodia’s economy will grow by 5.5% this year, Laos and Myanmar by 3.0%, and Vietnam by 6.2%.
The report identifies domestic demand and tourism as the main drivers of growth economic recovery of CLMV countries in 2023.
Theo SCB EIC, domestic demand countries will benefit from the above improvements labor marketreflected in Vietnam’s employment in the fourth quarter of 2022 skyrocketing to the highest level since the outbreak of the COVID-19 epidemic.
Meanwhile, the service sector will benefit from increased tourist arrivals this year, especially Chinese tourists, who accounted for regarding 30-35% of all foreign tourists in 2019.
China has allowed foreign group tours to Cambodia and Laos starting February 6, and is expected to add more destinations to the list soon.
[IMF hạ dự báo tăng trưởng của các nền kinh tế khu vực ASEAN]
Meanwhile, Cambodia and Vietnam are poised to benefit the most from the tourism recovery, given their high contribution to the Gross Domestic Product (GDP) of these two countries.
On the other hand, the report of SCB EIC said that falling foreign demand coupled with a weakening global economy might affect exports and foreign direct investment (FDI) of CLMV countries.
SCB EIC also believes that the reopening of China can partly reduce the adverse impact on exports and FDI.
However, there are risks that weak external demand might dampen domestic demand, manufacturing and employment in the CLMV countries.
In such a context, SCB EIC forecasts that the central banks of CLMV countries will probably implement tighter monetary policy this year, but policy normalization will take place gradually following inflation. tends to cool down.
Inflation in the CLMV countries will begin to ease along with a decline in global commodity prices in 2023, albeit at a slow pace.
Weak currencies – such as the Lao kip and the Myanmar kyat – will also keep import prices high.
Do Sinh (VNA/Vietnam+)
