Normal life is returning to Vietnam

Although the COVID-19 pandemic remains complicated and unpredictable, positive energy is returning to socio-economic life in Vietnam.

Workers at Saigon Aquatic Products Trading JSC are preparing seafood for export. (Photo: Phuong Vy)
Workers at Saigon Aquatic Products Trading JSC are preparing seafood for export. (Photo: Phuong Vy)

Enterprises are ramping up production to meet rising numbers of export orders while workers, protected by vaccination, are heading back to cities. Throughout the country, major transport projects are being accelerated to make up for the delays caused by coronavirus. Foreign investment continues to rise while private investment is flowing strongly to the economy through the establishment of new companies and the resumption of “hibernating” enterprises.

Vietnam’s economic outlook in 2022 is optimistic after two consecutive years of below-target growth due to the pandemic. In its latest report, the World Bank took note of Vietnam’s strong economic indicators ahead of the Lunar New Year thanks to a vaccination rate of over 73%. Industrial production has continued to grow; total retail sales and consumer services recorded positive growth for the first time since late April 2021; the trade balance maintained a surplus despite decelerating exports; foreign investment pledges and disbursement made a solid start; and credit in January grew at a faster-than-expected rate.

Standard Chartered has stated that Vietnam’s medium-term outlook remains positive, with economic growth expected to reach 6.7% in 2022 and 7% in 2023. Vietnam continues to be an important link in the global supply chain and preferred destination of many enterprises. Investment in Vietnam is forecast to recover in 2022 following the hiatus due to COVID-19.

Fitch Ratings is also upbeat about Vietnam’s economy, forecasting growth of 7.9% in 2022 and 6.5% in 2023 as a result of recovery in the domestic market and strong export growth.

According to experts, reviving the economy after the pandemic cannot rely on a few drivers only but needs an overarching policy. As such, the Government’s Resolution 11 on the socio-economic recovery and development programme has outlined many specific measures for each field, with nearly 350 trillion VND (15.3 billion USD) to be injected into the economy.

It is notable that most of the resources and measures will focus on opening the economy and promoting public investment. In the first days of spring, Prime Minister Pham Minh Chinh made an inspection tour of major transport projects to help remove the obstacles facing such projects and urge those in charge to accelerate the disbursement of investment capital.

The final pieces of aviation, tourism, education and entertainment activities are also being restored, clearly signifying the return to a new normal life. Only when enterprises resume their operations, people have stable incomes, and consumer activities return to normal will support activities be truly meaningful. The drivers for economic recovery are “operating” to take the Vietnamese economy back to the region of growth. Strong recovery and development in 2022 will lay a solid foundation for Vietnam’s development journey ahead.