KAS/Hang
In addition to the impact of the COVID-19 epidemic, businesses in Vietnam have to bear additional production costs due to the increase in raw material prices and land rents. Inflation in Q2/2021 increased to 2.67% (yoy) and 1.47% (yoy) in the first half of 2021 – the lowest levels since 2016. However, the inflation might increase in the near future due to the rise of food prices and education-related fees and energy prices fluctuations. Trade balance deficit due to the need to import materials to restore the production process. Interbank interest rates suddenly increased again after February. Vietnam's economic growth in 2021 is forecasted to reach 4.5% - 5.1%, which is 1.2 - 1.5 percentage points lower than the previous forecast.