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Banks tightened lending, real estate business activities in the second quarter grew at least 3 quarters

In the Vietnam Economic Update Quarter 2/2019 report of the Analysis and Advisory Department of Individual Customers of SSI Securities Company, the expert stated that Q2 GDP increased by 6.71%, which is a low growth rate. 8 most quarters. The two sectors with the highest proportion in the economy are manufacturing and processing industries and the slow growth of agriculture is the main reason for GDP deceleration. Some sectors of the service sector and the construction industry maintained stable growth and mining and positive growth helped GDP not to decline deeply.

GDP of service sector is pulled by many service sectors such as Retail and wholesale; Accommodation, dining; Transportation, warehousing, ...

Contrary to the slowing and sideways trend of the retail index, GDP of the Wholesale and Retail sector in the second quarter was higher than the first quarter, increasing 8.27% compared to 7.91%. However, SSI believes that this is a difficult thing to explain when the economic growth in the second quarter slowed down while the Retail sector grew faster.

The accommodation and catering industry also improved markedly, up 6.95%, higher than the first quarter of 5.91%. Growth of international visitors to Vietnam in the second quarter reached 8%, slightly higher than the first quarter of 7%. However, with only 1% increase in international visitors, it is hard to push the accommodation and accommodation sector significantly. In 2018, the growth of international visitors is up to 20%, but the accommodation rate of GDP growth is only 6.78%.

SSI explains the rapid improvement of accommodation and dining as domestic tourism with the expansion of many tourist destinations and new routes. However, in the context of slow economic growth, low retail index, the demand for tourism of Vietnamese people, a demand of non-essential groups, is also difficult to grow.

Also related to international visitors, Chinese visitors after a good recovery in May fell sharply in June, down 16.3%, dragging the total number of Chinese tourists since the beginning of the year decreased 3.3. % In contrast, the number of Korean visitors maintained stable growth, up 21.3%.

Meanwhile, low-growth sectors may include real estate business. Specifically, the real estate business in Q2 only increased by 4.13%, the lowest level in 3 quarters and also lower than the same period (4.56%).

Real estate industry may grow slower than statistics due to many reasons. On the supply side, administrative procedures for project formation and development are showing signs of slowing down. On the demand side, there is a tightening policy on real estate lending by commercial banks. It does not exclude the possibility that foreign investors, especially China and Hong Kong, have reduced their interest in Vietnam's real estate market for economic reasons.

Diep Tran

According to young intellectuals


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