Hanoi (VNA) – Vietnam posted animpressive growth rate of 7.38 percent in the first quarter of 2018, but thereremain many problems behind this 10-year high expansion, many experts said atthe April 10 launch of a report on the country’s macro-economy in Q1.

The report, which was released by the VietnamInstitute for Economic and Policy Research (VEPR), said the positive growthmomentum in the latter half of 2017 seems to have helped fuel the growth in Q1this year.

Processing and manufacturing continued to be akey driving force for the economy with an expansion of up to 13.56 percent, itnoted, adding that Samsung Vietnam remained the biggest contributor to theprocessing and manufacturing industry. The firm’s export of mobile phones andcomponents reached 12.3 billion USD in the three months, surging 58.8 percentyear on year.

The mining industry rebounded with a growth rateof 0.4 percent after two consecutive years of contracting. Industrialproduction output increased by 11.6 percent from a year earlier, much higherthan the growth of the same period of recent years.

VEPR Director Nguyen Duc Thanh said most of theadded value in this sector came from foreign direct investment (FDI) companies,as the manufacturing industry received great contributions from foreignenterprises.

This posed challenges for sustaining growth inthe following quarters as well as for the whole of 2018 and beyond, asVietnam’s economic growth is increasingly dependent on the FDI sector, Thanhsaid.

[Vietnam posts highꦰest first-quarter GDP growth in decade]

The report also noted that exports in the firstthree months are estimated at 54.31 billion USD, up 24.3 percent year on year.Up to 39.34 billion USD or 72.4 percent of the revenue came from FDI companies. 

Meanwhile, 53.01 billion USD worth of goods wereimported in the period, including 31.75 billion USD by FDI businesses and 21.26billion USD by domestic firms.

Thanh said these figures show a trade surplus inthe FDI sector and a trade deficit in the domestic sector, indicating thatforeign enterprises continue to be the trade locomotive of Vietnam’s economy.

According to the report, the rise of new jobsdid not match the high economic growth in Q1 compared to the same period last year.More than 225,000 new jobs were created between January and March of 2018,fewer than the over 291,000 new jobs in Q1 last year.

Thanh said the fewer number of new jobs amid ahigh growth rate once again brings into question the growth quality and thereal strength of the domestic sector.

The economy is predicted to continue expandingin the following quarters but the growth will not as high as in Q1. The reportsaid this year’s GDP growth target might clock in at 6.83 percent, higher thanthe 6.5 to 6.7 percent goal set by the National Assembly. Economic growth ratesfor the upcoming quarters are forecast at 6.51, 6.84 and 6.75 percent,respectively.-VNA