While Vietnam struggles with serious short-term economic problems, Citigroup has just released a report identifying it as one of the 11 most attractive high growth countries over the next 40 years. The other 10 are Bangladesh, China, Egypt, India, Indonesia, Iraq, Mongolia, Nigeria, the Philippines, and Sri Lanka.
The report says China will overtake the US to become the world’s largest economy by 2020, and India will take the number one position by 2050. At that time the world’s GDP is projected to be $380 trillion.
Meanwhile increasing concern about Vietnam’s economy has caused its leaders to unveil measures aimed at curbing soaring inflation rates as energy costs have risen as much as 24% — among them: a limit on credit growth this year to less than 20% and a cut in the budget-deficit target to less than 5% of gross domestic product from the previous 5.3%.
Vietnam’s inflation, weakening currency, and big trade deficits have led to an underperforming stock market, and analysts are urging clients with an appetite for frontier market risk to take advantage. The VNI index was down 10% last week alone, and the Vietnam market is among the worst performers in Asia in recent months.