On 15/7, with the support of Australian Program to Support Vietnam’s Economic Reform (Aus4Reform), Central Institute for Economic Management (CIEM) held a seminar on “Vietnam’s economy in the first 6 months of 2021: Reforms for restoring sustainable growth”.
According to CIEM, although Vietnam’s forecasted growth rate is quite positive compared to other countries in the region, Vietnam’s economy in the last 6 months may continue to suffer impacts from the uncertainty and risks in economy as well as the world.
Covid-19 and its variants are still complicated and unpredictable with potential of new breaking wave that bring consequences of a disruption in commodities supply chain, increase of logistics costs with impact on import and export, etc. Therefore, the pandemic control continues to be a strong factor affecting the growth rate. In addition, the disbursement progress of public investment, ensuring macroeconomic stability, supporting digital economy and transformation, the possibility to take advantage of opportunities from new FTAs as well as ensuring opportunities for female workers are factors affecting such growth.
In order to control the pandemic and promote economic growth, the new Government has urgently entered the operation and inherited the available policy framework in the way of direct and flexible handing issues of the pandemic prevention and economic recovery, considering new proposals in a stronger manner.
In the updated report on Vietnam’s economy in 2021, 2 scenarios are given by CIEM. First scenario, the pandemic in Vietnam is to be under control by 10/2021, creating conditions for the resumption of production and economic activities at normal condition. Second scenario retains most of the assumptions provided in the first scenario, except the pandemic is controlled in early 8/2021 and the world GDP growth rate, credit and investment disbursement from the state budget at a higher level. Accordingly, the forecast results show economic growth in 2021 in 2 scenarios could reach 5.9% and 6.2% respectively while exports increase by 16.4% in the first scenario and 18.3% in the second. Trade surplus is forecasted at US$ 4.2 billion and 5.4 billion respectively. Average inflation in 2021 will reach 2.6% and 2.8%.
In the last 6 months of 2021, Vietnam’s economy may be affected by a number of factors such as: pandemic controlling capability; public investment disbursement progress; macroeconomic stability; digital economy and transformation support as well as opportunities of utilization of new FTAs and female workers. Discussion at the Workshop showed that in the first 6 months, domestic and international economic context is not really favorable compared to 2020. The new Government has urgently entered the operation and inherited the available policy framework in the way of direct and flexible handing issues of pandemic prevention and economic recovery, considering new proposals in a stronger manner.
In the context of targeting “dual goals” and shaping the approach to an economic policy reform, Ms. Tran Thi Hong Minh, CIEM Director said that in the coming time, Vietnam should focus on 3 important solutions. Firstly, to ensure the parallelism between macroeconomic policy and microeconomic reform towards green and sustainable recovery. Secondly, to promote business recovery and improve internal capability, to associate the level of economic autonomy with effective implementation of international economic integration process. Thirdly, to promote innovation, develop science and technology towards the digital economy and obtain new skills for productivity improvement.