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On 1/10/2021, Ministry of Planning and Investment held a consultation conference on the economic recovery and development program for the period of 2022 – 2023.

Speaking at the opening, Minister Nguyen Chi Dung said that the pandemic brings not only difficulties and challenges but also lessons, opportunities and new futures for countries including Vietnam.

According to international experience and recommendations of international experts and organizations, Vietnam should build a program of economic recovery and development so as not to “miss the beat” in the “new normal” with a view to accelerate the transforming process of the growth model towards green economy, digital transformation and digital technology to actively participate more deeply in new global value chains, production and supply chains.

A series of policies, so far, have been issued by the Government to share difficulties with enterprises and people mainly including fiscal and monetary policies on taxes, fees, charges, debt freezing, debt rescheduling, extension and interest rate reduction of loans and state budget expenditures with a scale of about US$ 6.7 billion.

Through different channels such as the Unemployment Insurance Fund, exemptions and reductions in telecommunications, electricity, water, tuition fees, the size of support packages is about US$ 10.45 billion, equivalent to 2.84% of GDP in 2021. However, compared with regional countries like Thailand (11.4% of GDP) or Malaysia (5.3% of GDP), the supporting level is low.

In addition to support packages from the State (including fiscal policies prioritized for infrastructure investment, cost pressure reduction for businesses, support for people, laborers, development of green economy, digital economy and digital transformation, etc.), these countries also apply loosened monetary policies to increase access to capital and reduce loan costs for enterprises, especially those of medium, small and super small size, cooperatives and household business.

However, Vietnam’s support policies in the past time have been mainly aimed at solving short-term financial difficulties, mostly impacting the supply side of the economy; it lacks of comprehensive, long-term and synchronous solutions with adequate resources to promote the economic recovery process associated with structural reform, improve competitiveness and resilience of the economy to future shocks.

Currently, Vietnam has begun to change its approach to the Covid-19 in the direction of “safely adapting, flexibly and effectively controlling the Covid-19 pandemic” to conduct both effective pandemic prevention and restore and promote socio-economic development. The increasing coverage and progress of vaccination also create good conditions for opening up and restoring economic activities.

Therefore, the program of economic recovery and development is very urgent to get the right policies, focus all resources quickly, promptly and effectively to control the pandemic, support people and laborers to overcomes difficulties and challenges, seizes new opportunities and trends to quickly recover and develop in the new normal situation.

Andrew Jeffries, Director of Asian Development Bank in Vietnam, said that as Vietnam is a large open economy, the impact of the Covid-19 is adverse, however Vietnam’s largest commercial partners are on their rapid recovery and trade is promoted accordingly.

Besides, the vaccination rate in the country has also rapidly increased recently, creating favorable conditions for the early opening, contributing to the growth. The wider the vaccine coverage, the sooner the economy recovers.

“In addition, Vietnam should actively take advantage of free trade agreements to increase exports and participate more in the global supply chain. Vietnam needs to safely open its doors, ensure a smooth and healthy relationship between banks and businesses as well as be careful with bad debts” said Mr. Andrew Jeffries.

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