Vietnam’s GDP outlook is at stake as the wave of COVID-19 intensifies.

11-Aug-2021 Intellasia | Xinhua | 5:02 AM Print This Post

Vietnam is aiming for a 6.5 percent increase in gross domestic product (GDP) in 2021, with Vietnam having the worst wave of COVID-19 infection to date in less than five months. Has not been overcome yet.

As of Sunday, a total of 208,060 cases of domestic infection were registered in the country, including 206,490 since the wave began on April 27.

Southeast Asian countries are currently on the 11th consecutive day, with more than 7,000 COVID-19 cases increasing daily.

As the country’s Ministry of Industry and Trade (MOIT) acknowledged in its July report, achieving the country’s growth targets for the full year is extremely difficult, and proper management, production and operations of the COVID-19 pandemic. It is necessary to secure both activities.

Thanks to more effective management of COVID-19 earlier this year, Vietnam has enjoyed a steady economic recovery since the pandemic-stricken 2020, with GDP growth at 2.91 percent, the lowest in the last decade. It plummeted.

According to Vietnam’s Bureau of Statistics (GSO), Vietnam’s GDP growth in the first half of this year was 5.64 percent year-on-year, well above the 1.82 percent year-on-year.

The industrial and construction sectors are the main drivers, with a growth rate of 8.36 percent compared to the first half of last year, contributing 59.05 percent to overall growth.

On the trade side, Vietnam’s total trade value from January to July this year was US $ 373,360 million, an increase of 30.2 percent over the previous year.

However, the Delta subspecies spread in late April and the situation at COVID-19 in the country suddenly deteriorated, imposing rigorous but inconsistent epidemic measures and slowing the recovery momentum.

In particular, some industrial parks have been forced to temporarily shut down due to a cluster of infections in Hanoi, the capital of Vietnam, and the southern business hub HCM City (HCM City), which is now the centre of the COVID-19 wave. Both were placed under a major blockade in July, when the country’s strictest social distance expansion rules came into effect.

According to MOIT, the new wave of epidemics will play a bigger role in the country’s economy, in areas with more companies in the world’s industrial chains, such as the northern states of Bac Giang and Bac Ninh, where many industrial parks are located. It had a big impact. North port city Hai Phong and HCM City.

According to ministry data, Vietnam’s industrial production index in July rose 1.8 percent month-on-month and 2.2 percent year-on-year, the slowest pace in seven months.

According to the GSO, the number of new companies established in the country in July also decreased by 22.5 percent from the previous month, and the total registered capital decreased by 25.3%.

According to a survey by HIS Markit, an information services company based in Nikkei and London, Vietnam’s Manufacturing Purchasing managers Index (PMI) was 44.1 and 45.1. It shows that it has deteriorated significantly. PMI readings less than 50 indicate contraction, so continuously.

As a result, in late July, the Asian Development Bank lowered Vietnam’s GDP growth forecast to 5.8 percent in 2021 from its previous forecast of 6.7 percent in April.

For many Vietnamese, the country’s achievement of its economic growth goals ultimately depends on how the COVID-19 situation is handled.

Le Trung Hieu, Head of the GSO’s System of National Accounts, said Vietnam must show a GDP growth rate of about 7.2 percent in the second half of the year to reach its economic growth targets. Very weak internal capacity of the economy and major economies heavily affected by the pandemic. ”

According to the Vietnam Institute for Economic Policy, an independent think tank, even if the Vietnamese government could control the epidemic in August, the country’s economic growth rate in 2021 will reach 5.4 percent to 6.1%, which is below the target. 6.5 percent.

Trung Thanh, an associate professor at the National Economics University based in Hanoi, said that apart from the impact of domestic COVID-19 measures, Delta variant infections could also be at risk, and the goal could not be achieved. He said it was almost certain. Economic recovery of the world’s major economies. This adversely affects the attractiveness of Vietnam’s trade and investment.

Currently, vaccination against coronavirus remains at the top of the list of Vietnamese authorities. Vietnam’s Foreign Ministry spokesman Les Ti to Han has been vaccinated with 18 million COVID-19 vaccines from other countries and international organisations as of August 5 at a press conference last Thursday. Said.

However, as of Sunday evening, there were only 8.9 million doses nationwide, of which more than 7 million were the first doses.

Vietnam reported a new daily high of 9,684 domestically infected COVID-19 cases on Sunday.

Vietnam’s GDP outlook is at stake as the wave of COVID-19 intensifies

https://illinoisnewstoday.com/vietnams-gdp-outlook-is-at-stake-as-the-wave-of-covid-19-intensifies/335572/

 

Category: Economy, Vietnam

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