Professional Documents
Culture Documents
October 2012
Lam Phi Yen Head of Corporate Sales HCM Global Markets, Vietnam yenphilam@hsbc.com.vn +84-8-3520 4113
Agenda
Vietnam at a glance
Key data
Vietnam GDP (USD bln) 2011 123.6
Macro-economic performance
1.4
Population (m)
86.9
CPI (%) Trade balance (USD bln) International reserves (USD bln)
Average GDP growth rate in the past 10 years: 7.3% Demographic: 87 million people, with 70% of the population in working age (from 15 to 65 years old) Savings and investment rates are 29.2% and 34.2% in 2011 Average domestic credit growth of 33.7% far exceed average annual nominal GDP growth of 21.3% and average annual real GDP growth of 6.6% in the past 5 years Average inflation in the past 10 years: 7.8% The dong lost 30% of its value versus the greenback in the past 5 years Heavily dollarised economy
Industrial production growth(y-y): + 9.7% FDI disbursement : FDI pledges : Credit growth : FEX reserve : Stock market : - 1.2% ($8.1bio) - 27.9% ($9.5bio) + 2.2% + 100% ($23bio) + 11%
Agriculture, 16%
40.00 35.00
Service, 42%
Industry, 42%
Agriculture
Source: CEIC, HSBC
Industry
Service
3.50 3.00 2.50 2.00 1.50 1.00 0.50 0.00 -0.50 -1.00 AU CH HK IN ID JP 1990s SK MY 2000s NZ 2010s PH 2020s SG SL TW TH VN
9 50 45 40 35 30 25 20 15 10 2003 2004 2005 2006 2007 2008 2009 2010 GDP grow th 2011 2012f 2013f 8.5 8 7.5 7 6.5 6 5.5 5
Credit grow th
HSBC PMI 60 55 50 45 40 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 New Orders New Ex port Orders
Though contracted, the pace of contraction of both new orders and new export orders has been much slower than previous month Externally, growth is affected by Euro zone crisis, sluggish US recovery process and slowing China growth. The prospect for exports in coming months is not really positive
75 65 55 45 35 25 15 Apr-08 Feb-09 Dec-09 Oct-10 Aug-11 Retail Sales (% y --o-y ) Retail Sales (%3m/3m sa RHS)
23 18 13 8 3 -2 -7 Jun-12
Investment by sector
Investment by value
State makes up 51% of total investment (average figure of the last 10 years) Contributes about 40% GDP Inefficient but requires continued support to exist
55 45 35 25 15 1995 1997 1999 2001 2003 2005 2007 2009 2011 State Non State Foreign Inv ested Sector
Service sector recovers and leads the growth, followed by the industry
12
Construction sector contracted, little recovery seen but still remains in negative zone
13
27 22 17 12 7 2 Nov -07 Oct-08 Sep-09 Aug-10 Jul-11 Jun-12 May -13 Headline CPI (% y -o-y )
Source: HSBC, CEIC
HSBC Forecasts
8.00
4.00
-8.00
-12.00 Net FDI (USDbio) Current account balance (USDbn) Current account balance plus FDI (% GDP)
FDI registration as of Sep reaches $9.53 billion, equivalent to 72.10% vs last year. Disbursement: $8.1billion, contracted by 1.2% vs last year FDI by sector: Manufacturing 65.5%, real estate: 19% The largest sources of FDI pledges were: Japan (60.9%), Korea (7.1%), Hongkong (7.1%), Singapore (7.0%)
Source: CEIC, HSBC, GSO
Trade bal
Trade deficit 20 18 16 14 bio US D 12 10 8 6 4 2 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 (e) Year Trade deficit (bio USD)
YTD Sep trade balance is USD 30m surplus Robust export performance Import number is steady
18
3 KOREA
8.7 KOREA
Av erage Grow th Rate = 7% 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2011 2012 2013 GDP (% y -o-y ) HSBC forecasts
Reform?
Stress
Vietnam has broken the booming period Heavily-debted SOEs Banking system weakness Real estate market is frozen Slowing GDP growth with higher inflation has been hurting our workers and farmers Last but not least, the whole market is lack of TRUST
Hmmmm!!!
23
24
25
Phase 2
The Government has made significant progress in consolidating banks and SOEs, but that is not enough Real number on NPLs: ?% on $135bn of outstanding loans The SBV has a reasonable work-out program involving bank consolidations, bad debts reduction The shortfall of recoverable collateral against loans is estimated at $5bio How to resolve?
26
2500
'000 tons
trn VND
140
120
100 1500
1000
80
500
60
???
40
0 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 2015
20
29
And what will follow these appetites and habits ??? Retails sales industry Healthcare service
30
2010
6.8 1,156 14 11.8 26.4 21.2 -12.6 12.9 19,498
2011
5.9 1,382 14.7 18.58 33.3 24.7 -9.8 11.5 21,036
2012F
5.0 1,546 14 9.2 15.5 6.5 -2.0 18 21,500
2013F
5.8 1,751 N/A 10.7 28.5 28.8 -4.5 18 21,500
Source: HSBC
31
Fast-growing presence
18 outlets in key cities 150 ATMs Over 1,600 deposit outlets via Vietnam Post Over PCM 1,145 cash collection points