Pandemic pulls Vietnam’s Q1 GDP growth to decade low
A positive economic growth rate in the first quarter indicated strong efforts of both the government and the society in maintaining business production while combating the Covid-19.
Vietnam’s GDP growth in the first quarter (Q1) of 2020 is estimated at 3.82% year-on-year, the lowest Q1 growth rate in the past 10 years, dragged down by the growing impacts of the Covid-19 pandemic, the General Statistics Office (GSO) has announced.
|Data: GSO. Chart: Nguyen Tung.|
As the government prioritizes the fight against the pandemic to economic growth, a positive economic growth rate in Q1 indicated strong efforts of both the government and the whole society in maintaining business production while combating the Covid-19, said the GSO in its latest report.
In the January – March period, the sector of agriculture, forestry and fishery increased by 0.08%, contributing 0.2% to the overall growth; the sector of industry and construction rose by 5.15%, contributing 58.4%; and the service sector climbed by 3.27%, contributing 41.4%.
Slower growth of the agro-forestry-fishery sector compared to the same period last year was due to effects of the climate change, the Covid-19 pandemic and the African swine fever. The agricultural sector dropped by 1.17% during the period, shaving 0.1 percentage point off the overall growth.
In the industry and construction sector, the industry expanded 5.28% year-on-year in the three-month period, significantly lower than the 10.45% growth rate of Q1/2019 and contributing 1.89 percentage points to the overall growth.
Manufacturing and processing, the driving force of the economy in 2019, grew 7.12%, only higher than the 4.38% and 5.97% growth rates of the same period in 2013 and 2014 during the 2011 – 2020 period.
In the first few months of 2020, trade and services were among the hardest hit sectors by the pandemic. The service sector recorded the slowest growth for Q1 during the 2011 – 2020 period. With a growth rate of 5.69%, wholesale and retail contributed the highest added value to the economy in the service sector with 0.7 percentage points, while accommodation and catering services contracted 11.04%, equivalent to a decline of 0.53 percentage points.
Regarding the structure of the economy during Q1, the sector of agriculture, forestry and fishery made up 10.11%; the sector of industry and construction accounted for 35.52%; the service sector represented 43.71%; and product taxes less subsidies on production accounted for 10.66%.
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