World Bank forecasts Vietnam 2023 GDP growth to slow to 4.7%

HANOI (Reuters/AFP): The World Bank on Thursday forecast Vietnam's gross domestic product growth would slow to 4.7% this year, from 8% last year, citing a challenging external environment and weak domestic demand.

The World Bank said growth is forecast to accelerate to 5.5% next year and 6.0% in 2025.

Meanwhile. US President Joe Biden said Tuesday he would travel to Vietnam "shortly" as part of an effort to improve ties with Hanoi, as Washington seeks to counter China's influence in the region.

"I'm going to be going to Vietnam shortly because Vietnam wants to change our relationship and become a partner," Biden said during remarks in New Mexico.

"We find ourselves in a situation where all these changes around the world are taking place at a time we have an opportunity ... to change the dynamic," he added.

The United States and Vietnam have increasingly close trade links, while both share concern over China's growing strength in the region.

Friction has been increasing for years between Beijing and Southeast Asian nations, particularly Vietnam and the Philippines, over China's sweeping maritime claims in the South China Sea.

Washington and Hanoi pledged in April to upgrade diplomatic ties when US Secretary of State Antony Blinken stopped over on his way to a Group of Seven (G7) foreign ministers' meeting in Japan.

"We think this is an auspicious time to elevate our existing partnership," Blinken told reporters during the visit with Vietnamese leaders.

"We've had for the last 10 years this comprehensive partnership that has created an incredibly strong foundation of cooperation across many different areas. As a result, we think this is a good moment to go even further."

Blinken also attended a ground-breaking for a new US embassy in Hanoi.

And in March, Biden spoke with the head of Vietnam's ruling Communist party, Nguyen Phu Trong.

Washington has, however, bristled over human rights concerns in Vietnam, with Blinken saying he continued "to underscore how future progress on human rights is essential to unleashing the full potential of the Vietnamese people."

The South China Sea, the longtime center of tensions between China and Vietnam, is seen as a powder keg, and many fear a miscalculation or accident could ignite a military conflict.

Analysts say Hanoi may be more reluctant to elevate relations with Washington, wary of upsetting Beijing -- an important economic partner -- despite rival claims in the South China Sea.

The United States has no territorial claim over the waters, but has persisted in conducting its own patrols there, angering Beijing.

Washington says this is to ensure what it terms "freedom of navigation" in the sea, through which trillions of dollars in trade passes annually.

The United States has also sought to improve relations with China in recent months, with Blinken visiting in June after a previous trip was canceled when an alleged Chinese spy balloon was shot down by a US warplane after traversing the country earlier this year. = Reuters/AFP