Ho Chi Minh City, the southern economic hub of Vietnam (Photo: VNA)
Hanoi (VNA) –Like many other countries across the world, Vietnam has been badly affected bythe COVID-19 pandemic. However, experts still forecast a positive prospect for theVietnamese economy after the pandemic is stamped out.
“Still,Vietnam may get out of the pandemic in better shape than others. Despite theexpected growth rate decreasing to 4.9 percent in 2020, it is among the feweconomies in the Asia Pacific - and perhaps in the world - that still have positive growth rates,” said Nguyen KhacGiang, a senior research fellow at the Vietnam Institute for Economic andPolicy Research (VEPR) under the University of Economics and Business – the VietnamNational University, and a PhD candidate at the Victoria University of Wellington.
“The Asian Development Bank (ADB), whilepredicting the country’s sharp decrease in GDP growth, said that the Vietnameseeconomy remains ‘uniquely robust’ in the sub-region.Sharply decreased oil prices - despite a greater burden on Vietnam’s strainedbudget - give Vietnamese policymakers room for monetary and fiscal stimulus asinflation concerns fade away,” he said.
Giang added that Vietnam’s success in curbing the pandemic might attract foreign investors, as willits traditional advantages of cheap labour, political stability, and proximityto China. Social distancing is also helping accelerate the country’stransformation to a digital economy, which is considered by the government as apillar of sustainable growth.
Adam McCarty, Chief Economist of Mekong Economics inHanoi, also held that when the Vietnamese government declares an end to localcoronavirus spread, the domestic economy is likely to bounce back as far as itcan without foreign tourists.
“The domestic economy could revive and all the maskscould come off, so that would be a big stimulus and that could happen in lessthan a month from now,” he said.
According to the website www.voanews.com, Vietnameseofficials are preparing for a limited economic revival as their coronaviruscaseload stays low.
The governmentis rolling out incentives now to revive companies including exportmanufacturers, a backbone of the economy. Factories are still operating on local labor, and export growthfrom January 1 through March 15 grew 6.8 percent over the same period of 2019,it noted.
German enterprises were also optimistic about themedium-term recovery of the Vietnamese economy, according to the AHK WorldBusiness Outlook 2020 released recently by the German Chambers of Commerce andIndustry (DIHK).
AlthoughGerman firms expressed concerns about negative impacts of the COVID-19 pandemicon their business with 82 percent of investors forced to lower revenue growthtargets in the 2020 fiscal year, they expected recovery to come in the mediumterm.
Up to 72 percentof the respondents to the survey on which the report was based said they wouldcontinue to invest in Vietnam while 27 percent plan to recruit more workers./.
