While key economic indicators in January remains positive, the economy is set to go through a rough path amid a Covid-19 resurgence.
Vietnam’s economy picks up where it left off last year with a positive performance in the first month of 2021.
Handling of first container in 2021 at Hoang Dieu port, Hai Phong city. Photo: An Dang |
In January, the country’s industrial production surged by 22.2% year-on-year, in which manufacturing and processing, a key driving force for growth, rose by 27.2%.
Such high growth came from strong production expansion of key industrial products, including phones and parts (71.5%); steel (63.4%); vehicles (38.2%); cement (35.8%); and milk powder (31.1%).
Growing demands ahead of Tet holidays led to an expansion by 6.4% year-on-year in January in total retail sales of consumer goods and services in Vietnam to VND480 trillion (US$20.83 billion).
Meanwhile, the consumer price index (CPI), a main gauge for inflation, slightly increased by 0.06% month-on-month. This resulted in a 0.27% month-on-month growth in the core inflation rate.
New business formation saw an increase both in terms of number and registered capital in the first month of the year, standing at 10,100 newly established enterprises or an increase of 21.9% year-on-year. Total new and additional registered capital pumped into the economy by enterprises in January rose by 10.5% year-on-year to VND395.1 trillion (US$17.14 billion).
Challenges remain
Economist Nguyen Minh Phong said while key economic indicators in January remain positive, the economy is set to go through a rough path amid a Covid-19 resurgence.
According to Mr. Phong, a modest rise of 0.06% month-on-month in inflation rate indicated slow recovery in domestic consumption.
While there has been a strong growth in new businesses, Mr. Phong also pointed out a 54.3% surge in the number of enterprises temporarily suspending their operation at 18,100.
“More supportive policies needed to aid the business community affected by the pandemic, particularly in taxes, technologies and financial leverage for large scale projects with high spillover effects,” said Mr. Phong.
“Innovation and R&D should be the focus for local enterprises, which in turn would benefit national competitiveness in long-term,” he noted.
While the pandemic continues to put pressure on the economy, there remain factors that could serve as a boost for growth, including exports and public investments, added Mr. Phong.
Phan Duc Hieu, vice director of the Central Institute for Economic Management (CIEM), said Vietnam’s effective measures against the pandemic is fundamental to keep the business running.
“In long-term, it is essential to continue improving the business and investment environment and take advantage of new business models to ensure sustainable economic growth,” Mr. Hieu stated.
Other News
- IT training urged to focus on semiconductors
- Hanoi Great Souvenir Fair 2024 to take place next week
- As orders rise, Vietnamese textile firms see better prospects in 2024
- C.bank to auction nearly 17,000 gold taels on April 22
- Trade ministry proposes purchasing renewable electricity mechanisms without EVN’s involvement
- Australia and Vietnam develop competitive electricity markets
- Vietnam, Thailand advance realization of “Three Connections” strategy
- Vietnamese Gov’t to expand list of electricity buyers under direct power agreement scheme
- Viettel opens largest data center in Vietnam to support AI development
- Vietnam’s economy expected to grow at solid pace in 2024-2025: ADB
Trending
-
Capital Law revision helps Hanoi promote role as nation’s socio-economic hub
-
Vietnam news in brief - April 25
-
Vietnamese contemporary ballet celebrates Europe Day
-
IT training urged to focus on semiconductors
-
Voluntary social security should cover larger part of informal sector: Experts
-
ASEAN Future Forum 2024: Promoting regional centrality
-
Central bank moves gold auction to tomorrow
-
[Video]Hanoi beauty spots featured in saxophone legend Kenny G's music video
-
Colorful stage shows in Hoan Kiem Lake pedestrian area