Services industry grows despite nationwide economic slowdown

Services industry grows despite nationwide economic slowdown

During the 2011 -2013 period, HCM City placed particular emphasis on the service, industry and agriculture sectors, with the services industry seeing the fastest rate of growth.

Despite challenges from the national economy, the services sector retained a growth rate of 11 per cent per year, with turnover from the sector representing over 58 per cent of total GDP growth, according to HCM City People's Committee.

Trade accounted for 22.1 per cent of growth in the service sector, with a growth rate of 12.3 per cent annually.

Of that amount, exports gained US$84.4 billion or 8 per cent growth annually, the same growth rate of the previous four-year period between 2006 and 2010, which was 8.1 per cent.

Also, in the trade segment, the commodities sector focused on industrial processed products and intellectually realised products rather than the production of natural raw materials.

After trade, finance, banking and insurance ranked second in rate of growth.

During the period, the banking system faced many difficulties with slow credit growth.

A high inventory level of goods and a stagnant real estate market limited the success of this sector.

In 2011, finance, banking and insurance grew 23 per cent but fell to minus 2.3 per cent. It jumped to 8 per cent in 2013, with an average of nearly 20 per cent of total GDP.

Transport and storage ranked third in the services sector with 11.3 per cent growth every year and a proportion of 13.8 per cent of GDP, thanks to a series of transport construction projects that have been completed in HCM City.

Information and telecommunications, along with science technology consultancy, all developed speedily during the period.

For the last three years, information and telecommunications grew from 16.1 per cent in 2011 and up to 26.8 per cent in 2012, and 20 per cent in 2013.

The sector's proportion of GDP increased from 4.6 per cent in 2011 and 6 per cent in 2013.

Science technology consultancy retained its growth of 18.5 per cent each year and improved its proportion from 8.2 per cent in 2011 to 9.3 per cent last year.

Education, hotels and restaurants also saw positive growth.

According to the yearly plan, the city will continue to develop its service sector and in 2015, the city expects to have 57 per cent of GDP from services, 42 per cent from industry and only 1 per cent for agriculture.

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