Illustrative photo (Source: VNA)The article wrote that, having impressed the world by taming thevirus last year, Vietnam is now in the middle of its worst outbreak of COVID-19by far. Parts of the country are in strict lockdown and a swathe of factories,from those making shoes for Nike to those producing smartphones for Samsung,have either slowed or shut down, disrupting global supply chains.
In 2020, Vietnam’s GDP rose by 2.9 percent even as mostcountries recorded deep recessions. Despite the latest outbreak, this yearcould see faster growth: the World Bank’s latest forecasts, published on August24, expect an expansion of 4.8 percent in 2021.
The author said such performance hints at the real reason tobe impressed by Vietnam. The nation’s openness to trade and investment has madeit an important link in supply chains. And that in turn has powered aremarkable and lengthy expansion. Vietnam has been one of the fivefastest-growing countries in the world over the past 30 years. Its record hasbeen characterised not by the fits and starts of many other frontier markets,but by steady growth. The government is even more ambitious, wanting Vietnam tobecome a high-income country by 2045, a task that requires growing at 7 percenta year.
The article said Vietnam’s deep connection to global supplychains and high levels of foreign investment makes it seem more like Singapore.Since 1990, Vietnam has received average foreign direct investment inflowsworth 6 percent of GDP each year, more than twice the global level.
As the rest of East Asia developed and wages there rose,global manufacturers were lured by Vietnam’s low labour costs and stableexchange rate. That fuelled an export boom. In the past decade, exports bydomestic firms have risen by 137 percent, while those by foreign-investedcompanies have surged by 422 percent.
The author concluded that the setback from COVID-19 aside,it might seem hard not to be rosy about a country that appears to be in theearly stages of emulating an East Asian economic miracle./.
VNA
