Exports remain key role in Vietnam's economic growth

Export activities would play a key role for the local economy in years to come, said Chief Economist at the Vietnam Institute for Economic and Policy Research (VEPR) Pham The Anh at the launch of the annual Vietnam economic report 2021 today [July 29].

Production at Rang Dong Company. Photo: The Hanoi Times

“The pace of export growth, however, is largely dependent on the recovery of the global economy and the competitiveness of Vietnam’s export staples.”

Anh also noted the three growth scenarios for Vietnam this year, with the GDP growth of 4.5-5.1% the most likely one, much lower than the 6% target set by the National Assembly and 1-1.5% percentage points lower than VEPR’s previous forecast in the first quarter.

“This scenario is based on the assumption that Vietnam is able to contain the pandemic by the late third quarter, and the quick vaccination roll-out helps the country to achieve herd immunity by the second quarter of 2022,” Anh added.

In a more favorable case when Vietnam could put the pandemic under control in August and the vaccination program is completed by the late first quarter of 2022, the GDP growth could be around 5.4-6.1%.

For the last and worst scenario, the GDP growth could only expand by 3.5-4% as the outbreak persists to the fourth quarter and the vaccination gets delay due to the lack of supplies.

“Overall, the GDP growth in 2021 remains much improved due to the low base last year,” Anh said.

According to the economist, the economic recovery in short term would rely on the vaccination progress, Vietnam’s effectiveness in the Covid-19 fight, and the disbursement of support programs.

In this regard, VEPR Director Nguyen Anh Thu suggested the government focus on fighting the pandemic, accelerating the development of locally-made vaccines, and acquiring vaccines from abroad.