Vietnam strives to tackle COVID-19 challenges as part of economic recovery

According to Andrew Jeffries, country director for Vietnam of the Asian Development Bank (ADB), similar to other countries, the nation is facing plenty of challenges caused by the novel coronavirus (COVID- 19) pandemic. Despite these issues, the Government’s capable handling of the pandemic has laid the foundations for high economic growth ahead in 2021.

Due to these positive signs, experts believe Vietnam's economic growth is expected to reach 6.3% in 2021.

Jeffries is optimistic regarding the nation’s economic forecast in the year ahead, stating that the country has been done well to control its economy during the outbreak of the pandemic, recording positive GDP growth in the process. Meanwhile, many global and regional economies have suffered negative growth rates and faced many more complicated issues in comparison to Vietnam.

The country's primary focus on disease prevention and control has created favourable conditions for socio-economic recovery and development moving forward. Assoc. Prof. Dr. Nguyen Anh Thu, vice rector of the University of Economics - Hanoi National University, predicts that the national economy will achieve a growth rate of 6%, as set out by the Government.

“The economic picture of Vietnam will be better than some other countries, with 2021 believed to be a year of recovery. According to forecasts of some organisations, the national economy could grow at 6% this year," Dr. Thu says.

According to expert Le Duy Binh, managing director of Economica Vietnam, the nation is set to see a growth rate among the leading countries in the world, in addition to in East Asia and Pacific, this year.

Some international organisations have assessed the country’s growth scenario could reach between 6% and 6.7% in 2021, potentially reaching 6.5% to 7% by 2022. This is based on a number of factors, such as macroeconomic stability, national pandemic containment efforts, as well as global economic growth forecasts.

"International organisations always give a positive assessment of Vietnam's growth. This shows the confidence of foreign investors in Vietnam's economy in 2021 and the following years. We need to make greater efforts to maintain macroeconomic stability while continue to stay vigilant against the pandemic to ensure that it will not break out again in Vietnam. This is a decisive factor," Binh emphasizes.

Many economic experts have therefore recommended that the stability and growth of the country’s macroeconomy in the year ahead is dependent on success in slowing the spread of COVID-19.

As a result, they have underlined the need to continue promoting public investment and spending, whilst simultaneously effectively implementing financial and monetary measures to support businesses and people through tax reduction, tax deferral, and free land use for businesses.

Furthermore, it remains essential to support consumption recovery efforts, increasing trade exchanges, enhancing institutional reforms, in addition to improving the local business environment. This can be done whilst stepping up policies to improve household and business income and fully taping into the domestic market in the face of a decline of domestic aggregate demand.

Moving forward, the country needs to increase the exploitation of opportunities from joining bilateral and multilateral trade agreements, as well as from the relocation and reposition of regional and international supply chains to countries with lower costs and safety. This will serve as a premise to achieve economic growth in 2021 and in subsequent years, they add.