REUTERS, Hanoi

Vietnam’s economy slowed ​in the first quarter from the three months prior, data showed on Saturday, as heavy exposure to ‌Middle Eastern oil imports boosted inflation, presenting a challenge in reaching an annual growth target, authorities said.

Gross domestic product grew 7.83 percent in the quarter from January to March over the corresponding period a year earlier, but below 8.46 percent in the fourth quarter, the National ​Statistics Office said in a report.

“The pressure from rising input costs and energy prices on inflation remains, posing ​challenges for economic governance,” the NSO added on Saturday.

Consumer prices rose 4.65 percent in March on the year, driven by a surge of 10.81 percent in transport costs, it said, accelerating from a rise of 3.35 percent ​in February.

This year’s growth target of at least 10 percent is under pressure as the Southeast Asian economy imports more than ​80 percent of crude oil supplies from the Middle East, where the Iran war, now in its sixth week, has disrupted shipments.

“Entering the second quarter, Vietnam’s socio-economic situation continues to face obstacles, and meeting the 2026 growth target remains a big challenge,” said NSO Director Nguyen Thi ​Huong.

Rising fuel prices have spurred Vietnamese airlines to scale back operations and government efforts to cut costs, such as ​reducing taxes on fuel, subsidising prices and encouraging remote work to reduce consumption. Growth was up from the 7.05 percent on-year expansion of the ‌first quarter of 2025.

Exports rose 20.1 percent in March to $46.44 billion from a year earlier, the report said. March industrial production rose 6.9 percent from a year earlier, but slowed from growth of 8.6 percent in the corresponding month last year.