HCM City (VNA) – Ho Chi Minh City is facingchallenges to realise its yearly growth target of 7.5%, as the rates recorded inthe first and second quarters failed to meet expectations.

In the first three months of this year, the growth of the country's biggest economic locomotive dropped significantly, even below expectations of experts.

In the second quarter, its gross regional domesticproduct (GRDP) grew some 5.87%, higher than the 0.15% recorded in the sameperiod last year, raising the city's six-month GRDP growth to 3.55%, which was however still lower than the 3.82% of the corresponding time in 2022, according todeputy head of the municipal Statistics Office Tran Phuoc Tuong.

Local exporters, including those in theleather-footwear sector, are encountering a host of challenges.

Vice President of the HCM City Leather and FootwearAssociation Nguyen Van Khanh said leather-footwear exporters are facing asevere lack of orders, and many are struggling to stay afloat.

Meanwhile, about 10-20% of the Association ofGarment, Textile, Embroidery and Knitting in HCM City (AGTEK) members have nochoice but to leave the market, its President Pham Xuan Hong said.

Experts pointed to major challenges relating toexport market, declining domestic consumption and the increasing number ofenterprises withdrawing from the market.

In the first five months of this year, up to 18,243businesses quit the market in HCM City, a gloomy sign for the local economicdevelopment.

To deal with the situation, the city has rolled out a bunch ofsolutions to spur economic growth and stimulate domestic consumption, saidDirector of the municipal Department of Industry and Trade Bui Ta Hoang Vu.

He also suggested launching more promotionprogrammes this summer to stimulate domestic consumption, saying this is also asolution to be pursued by the tourism sector in the time ahead.

Director of the State Bank of Vietnam (SBV) in HCMCity Vo Minh Tuan noted that some commercial banks are now ready to ensurebusinesses’ access to credit loans.

Chairman of the municipal People’s Committee PhanVan Mai stressed that the city has identified public investment disbursement asa key task, contributing to supporting the local economic growth in the secondhalf of this year.

The disbursement rate is expected to stand at 35% atthe end of this month, he said, adding that the city will also optimise itsspecial mechanisms and policies to attract investments in transport and urbaninfrastructure, and boost the development of other sectors./.