Vietnam Inflation at 28.3%

Aug. 25, 2008
Trade deficit hits $16 billion

Inflation was 1.56% up from July and had reached 21.7% since the start of 2008, the General Statistics Office (GSO) estimated in a preliminary report. But for July the figure was 28.3% year-on-year.

"The inflation figure of the first eight months of the year is still comparatively high, particularly because of the increase in the prices of oil and gas," said Ngo Tri Long, deputy director of the official Institute for Market and Prices Research. "High inflation is now a global problem, and Vietnam is not an exception," he said, adding measures to curb consumer price rises had made some progress.

Vietnam, a nation of 86 million people, had been lauded as Asia's next economic tiger.But it has been battered in 2008 by double-digit inflation, a ballooning trade gap, tumbling share prices and worries about the banking sector and its currency, the dong. The Vietnamese authorities have hiked interest rates and imposed stricter credit control to stem inflation, but do not expect it to fall back to single digits before the end of next year.

Food prices rose at an annual rate of 44.1% in August, while beverage and tobacco costs were up by 12.4%. Prices for housing and construction materials increased by 27.4%.

The country's trade deficit widened to $16 billion with exports at $43.3 billion, up by 39.1%, and imports totalling $59.3 billion, up by 54.1%.

The trade deficit for August alone stood at $900 million.

Copyright Agence France-Presse, 2008

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