Top 10 economic events of Vietnam in 2021

The adoption of some unprecedented measures supporting the COVID-19 fight, the commitment to achieving net zero emissions by 2050, and new records in the stock market are among the 10 most outstanding economic events of Vietnam in 2021.

1. Some economic targets achieved and surpassed amid severe impacts of COVID-19 pandemic

The fourth wave of COVID-19 infections has taken a heavy toll on the economy and society when prolonged and widespread social distancing was imposed on many provinces and cities. A large number of businesses have faced difficulties and bankruptcy due to disruptions to global supply chains.

In that context, Vietnam has managed to achieve and surpass some economic targets: the gross domestic product (GDP) grew by over 2%; trade revenue rose 22.4% to over US$660 billion, turning Vietnam into one of the 20 leading economies in terms of international trade; trade surplus reached about US$3 billion; and the attracted foreign direct investment exceeded US$29 billion, up by over US$0.5 billion from 2020. These are the fruits of efforts and determination by the entire political system and economic elements in implementing the important policies to realise the twin targets of fighting against the pandemic and developing the economy.

2. Resolution issued to permit some unprecedented measures supporting COVID-19 combat

On July 28, at the first session of the 15th National Assembly, the parliament issued Resolution No. 30/2021/QH15, which assigned the Government and Prime Minister to make decisions about and organise the implementation of some measures that haven’t been stipulated or are different from the provisions in existing laws and ordinances so as to meet urgent requirements in the COVID-19 prevention and control.

Under this resolution, the Government promulgated many policies, especially Resolution No. 86/NQ-CP on the urgent anti-pandemic solutions, which has created conditions for ministries, sectors, and localities to proactively take steps against COVID-19, guarantee social security, and assist the pandemic-hit people and businesses.

Data from relevant agencies show that as of early December 2021, authorities exempted, reduced, or extended payment deadlines for about VND140 trillion (US$6.1 billion) worth of tax and fee for enterprises; provided over 253,000 tonnes of rice for people; disbursed VND1.754 trillion for helping pay salary to workers; and exempted and reduced about VND31 trillion in interest and fee for clients of credit institutions.

3. National Assembly adopts economic restructuring plan

On November 12, at the second session, the 15th National Assembly approved a resolution on the economic restructuring plan for 2021 - 2025. This resolution pointed out the need to form a reasonable and efficient economic structure, develop many national products based on new and high technology, make breakthroughs in the competitiveness of some key economic sectors, and improve the economy’s self-reliance, adaptability, and resilience.

Amid opportunities and advantages intertwined with challenges and difficulties, especially when the COVID-19 pandemic remains complicated, the Government stressed that this plan needs to be implemented strongly to accelerate economic recovery and create an impulse for making breakthroughs in the time ahead.

4. Vietnam commits to achieving net zero emissions by 2050

At the World Leaders Summit of the 26th UN Climate Change Conference (COP26), Prime Minister Pham Minh Chinh declared Vietnam’s commitments to climate change response. Accordingly, the country pledged to reduce net emissions to zero by 2050 and agreed to support the important declarations and initiatives on forest protection, transition to renewable energy, assistance for local communities’ adaptation, and methane reduction. It also committed to gradually omitting coal from electricity production and stopping support for the building of new coal-fired power plants.

The strong commitments by Vietnam have received positive assessment from the international community and shown its leading role in the fight against global climate change in Southeast Asia and the world at large.

5. Vietnam marks 15 years of WTO membership, affirms stature in integration

The country marked the 15th year since it became a member of the World Trade Organisation (WTO) on November 7, 2006. According to the WTO, among the 50 countries with the largest trade in goods in the world, Vietnam has recorded breakthrough growth.

Total trade turnover rose by over 7-fold to exceed US$667 billion in 2021, from only US$84.7 billion in 2006. The country has continually seen growing trade surplus since 2016, with a record of over US$19 billion in 2020. This year, trade surplus still reached about US$3 billion despite difficulties caused by the COVID-19 pandemic.

Together with the WTO, the 17 free trade agreements that have come into force or are under negotiation have turned Vietnam into an economy with its openness equivalent to 200% of GDP.

6. First-ever country strategy dialogue between Vietnam and WEF

On October 29, Prime Minister Pham Minh Chinh co-chaired a country strategy dialogue held both in person and via videoconference between Vietnam and the World Economic Forum (WEF). The event was attended by nearly 70 leading businesses in the region and the world that have invested or planned to invest in Vietnam. It was a chance for the Government to share economic restructuring plans so as to promote the cooperation with enterprises in resuming production and business activities, especially in industrial, export processing, and special economic zones.

7. Vietnam sees higher position in global soft power rankings

Vietnam is the only ASEAN country to record a higher position in the Global Soft Power Index Report 2021 released by Brand Finance, the world's leading brand valuation consultancy. It saw an improvement of 2.5 points in overall score to rank 47th among the 105 countries in the list  According to Brand Finance, Vietnam seems to have managed all aspects of its perception quite well, especially the integration and alignment of its nation brand and the brands from the country.

8. Vietnam becomes one of top 10 emerging logistic markets

In the 2021 Emerging Markets Logistics Index released by the world’s leading logistics company Agility, Vietnam jumped three places from 2020 to the 8th position in this year’s rankings.

In recent years, the country’s production and technological capacity has improved considerably, helping attract investment from producers. Amid the world’s logistics industry undergoing a year full of challenges and fluctuations, Vietnam ranking among the top 10 emerging logistics markets has opened up promising opportunities for investment attraction. It is expected to help achieve the Government’s target that by 2025, logistics services will contribute 5 - 6% of GDP and grow by 15 - 20%.

9. New records in stock market

In 2021, the stock market of Vietnam set new records. The benchmark VN-Index hit 1,500.8 points, the highest score so far, on November 25, rising by nearly 36% from the end of 2020. Liquidity frequently reached billions of US dollars and set a record of nearly VND53 trillion (almost US$2.3 billion) on December 23. In the first 11 months of this year, domestic investors opened more than 1.3 million securities accounts, higher than the combined number of the four previous years. Domestic investors formed the decisive factor in the historic records of the stock market this year.

10. First urban rail route in Vietnam put into use

On November 6, the Ministry of Transport and the Hanoi People’s Committee officially put the Cat Linh - Ha Dong urban rail route in the capital city into operation. As the first urban rail route in Hanoi and the whole country, this mode of public passenger transport is hoped to help reduce traffic congestion in the capital.

The elevated route, 13.05km in total length, consists of 12 stations, starting at Cat Linh Station and ending at Yen Nghia Station, and 13 trains. It was funded by China’s official development assistance with total investment of VND18 trillion, rising by 57% from the initial estimate. The construction lasted for 10 years and missed deadlines for multiple times.