HCM City’s GDP per capita soars to over US$2,500

The HCM City economy, despite adverse impacts from the global economic recession, has managed a gross domestic product growth rate of 10.7% last year, sending the GDP per capita to over US$2,500 as targeted, the General Statistic Office (GSO) said.

The city’s gross domestic product in 2008 is VND289.55 trillion, or US$17.33 billion, an increase of only 10.7% against 2007, or the lowest growth since 2003, GSO said in a report released on December 31. Despite the slowdown, the GDP per capita still exceeds the target.

In November 2007, the HCMC Party’s Committee set up a target to achieve a GDP growth rate of 12.7-13% in 2008 and increase the annual per capita GDP to US$2,500. While the annual GDP growth rate fell short of the target, the per capita figure is still agreeable, averaging out at US$2,534 given the city’s population of 6.84 million people (calculated on the average exchange rate of VND16,700 for 2008).

According to the GSO report, the proportion of city households living under the poverty line has been reduced to 0.34% and there is no household with an income lower than VND6 million (US$359) per year.

Investment for development last year was approximately VND115.24 trillion (nearly US$6.9 billion), a year-on-year increase of 21.2%, and the CPI growth was put at 22.24%.

Also according to GSO, Vietnam’s GDP per capita last year was estimated at US$1,024, lifting the country off the list of poor countries with a GDP per capita of less than US$960 as per the United Nations’ standards.

Vietnam’s GDP per capita has nearly reached the threshold for medium-income countries. However, according to the GSO’s release, the most important thing is sustainable development and how Vietnam can maintain its economic growth.

“Vietnam’s economic results in 2008 do not show the sustainable development. The economic re-structuring progress is still slow, people’s living standards are not much improved, while increasing prices cause more difficulties to many people, especially those living in the rural areas and mountainous regions”, GSO said in a press release.

Nguoi Lao Dong quoted Nguyen Minh Phong from the Hanoi Socio-Economics Development Institute as saying that quality of growth is more important.

He said it is necessary now not to look at the beautiful GDP growth figure, but at the nature of the figure. It would not be significant if GDP grew rapidly but businesses’ competitiveness remained low.

Besides, experts also said GDP is not the only figure that shows the development level of a nation. The most important things are growth quality and people’s living standards.

They said that the Vietnam’s economic achievement in 2008 are very modest compared to the progress made by neighboring countries such as Singapore, Malaysia, Indonesia and Thailand. For example, the gap between the GDP per capita of Vietnam and other regional countries remains big.

The Vietnam Development Report released by the World Bank last December said that Vietnam might have to take 158 years to catch up with Singapore, 95 years with Thailand and 51 years with Indonesia. (SGT)