The International Monetary Fund has said Vietnam's economy is at risk of suffering external shocks if it doesn't go ahead with crucial reforms in sectors including banking.

The extended commodities decline, continued slowdown in China and tightening monetary policies elsewhere in the region will deal a blow to the Southeast Asian nation's economy, the Fund said, according to Bloomberg.

"The risk is that from being slightly vulnerable, Vietnam could become very vulnerable to external shocks," IMF chief Christine Lagarde said.

"It would expose the Vietnamese economy and that would not be good for the Vietnamese population."

Lagarde said the banking system needs to be made stronger "with less stressed assets in its balance sheets so the banks can actually fuel the economy."

Vietnam's Prime Minister Nguyen Tan Dung has said the country aims to achieve gross domestic product expansion of 7 percent, up from an earlier projection of 6.7 percent.

According to a Bloomberg surrey, the economy is projected to grow at 6.6 percent this year.

Vietnam, which is in the middle of a political transition, said in December its economy grew 6.68 percent in 2015, the fastest pace in five years.

Vietnam's growth rate has been rising since 2012 when it adopted strategic reforms to come back from the brink of a collapse triggered by a property bubble burst.

Hanoi also rolled out negotiations for 12 free trade deals, including those with the European Union, South Korea and the Russian-led Eurasian Economic Union.

Vietnam is also seen to hugely benefit from the recently concluded Trans-Pacific Partnership (TPP).