Moody's Investors Service on Wednesday retained Vietnam's 'B1' sovereign ratings and its 'negative' outlook.
The economic strength reflects very low GDP per capita and the competitiveness of the nation may be challenged by structural improvements in other regional economies, the rating agency said.
The country has made much progress in recovering from a period of macroeconomic instability, but continues to face contingent risks that justify the negative outlook, it said. Moreover, the rating is constrained by institutional weaknesses.
According to Moody's, macroeconomic stability has been restored following the implementation of policy tightening measures since early 2011. Although inflation eased markedly, concerns about economic growth emerged.
Moody's expects real GDP growth to average 5 percent over the next two years.
The negative outlook reflects the uncertainties related to from the financial health of the banking system and the state-owned enterprise, Moody's said.
For comments and feedback: editorial@rttnews.com