Workers examine electronic components at the factory of the Young Poong Electronics VINA Co. Ltd in Binh Xuyen II Industrial Park, Vinh Phuc province (Photo: VNA) Hanoi (VNA) – One of the fastest economic growthrates in the region, the signing of free trade and investment protection dealswith the EU, and the Politburo’s first-ever resolution on foreign investmentattraction were among the top 10 economic events of Vietnam in 2019.
The following define Vietnam’s economy this yearas selected by the Department for Economic News at the Vietnam News Agency:
1. GDPgrowth rate among the fastest in the region
In 2019, Vietnam posted a gross domestic product(GDP) growth rate of 7.02 percent amidst the growing strategic competition inthe region and the world. This is the second straight year the country hasfulfilled all 12 targets set by the National Assembly, including a record tradesurplus of 9.94 billion USD, total registered foreign direct investment (FDI)capital of 38.02 billion USD – a 10-year high, low budget overspending, andinflation under 3 percent. This is also the fourth consecutive year inflationhas been kept below 4 percent.
2.Vietnam inks free trade, investment protection deals with EU after nine-yearnegotiations
On June 30, the EU-Vietnam Free Trade Agreement(EVFTA) and Investment Protection Agreement (EVIPA) were officially signed inHanoi. The new-generation deals commit to the highest standards between Vietnamand the EU. Under the EVFTA, the two sides pledge to slash nearly 100 percentof import tariffs, the strongest cut among the FTAs Vietnam has signed.Meanwhile, the EVIPA also holds significance as it helps ensure an open andbetter investment and business climate for investors from around the globe.
3.Politburo issues first-ever resolution on foreign investment attraction
On August 20, the Politburo issued Resolution50-NQ/TW, setting up orientations for perfecting institutions and policies, andimproving the quality and effectiveness of FDI attraction until 2030. The firstissuance of a particular resolution on FDI was highly valued by both domesticand foreign investors. It details Vietnam’s strategic priorities in FDIattraction, which are projects that apply new, high and clean technologies,have modern governance methods and high added value, and connect with globalproduction and supply chains. It is a prerequisite for the country to attract anew generation of FDI capital with higher quality.
4.Vietnam jumps 10 places in Global Competitiveness Report 2019
On October 9, the World Economic Forum (WEF)released a report which shows that Vietnam has leapt 10 places on the GlobalCompetitiveness Index from 77th position in 2018 to 67th in 2019, making thecountry the most improved in the rankings. This is the first time Vietnam hasmoved up to the upper half of the list that covers 141 economies. This result wasattributed to the Vietnamese Government’s persistent reform efforts amid globaluncertainties caused by geo-political and trade tensions.
5.African swine fever spreads nationwide
On February 19, the Ministry of Agriculture andRural Development officially reported the first-ever appearance of Africanswine fever in Vietnam. This is a dangerous disease with no vaccine ortreatment currently available. The ministry said there has never been anepidemic that has caused such widespread damage and difficulties. The wholepolitical system has taken drastic measures to fight this epidemic. Bymid-December, nearly 6 million pigs weighing over 342,800 tonnes had beenculled, accounting for about 9 percent of the nationwide herd. The epidemic hasled to a pork shortage, pushing pork prices up in the final months of the year.
6.National target programme on new-style rural area building completed two yearsahead of schedule
On October 19, the Central Steering Committeefor the national target programme on new-style rural area building held aconference to review the programme in 2010-2020. After nearly 10 years, theprogramme has given a facelift to Vietnamese countryside, raising farmers’stature, improving rural living standards and continuing to restructureagricultural production towards modernity and sustainability. By October, 4,665communes, or 52.4 percent of the total nationwide, had been recognised asnew-style rural areas, 2.4 percent higher than the target.
Building a new-style countryside has a beginningbut no end, so Prime Minister Nguyen Xuan Phuc called on localities and sectorsto push ahead with the work in the 2021-2025 period.
7.Commercial banks race to increase charter capital
In 2019, an array of commercial banks moved toraise their charter capital to ensure their capital adequacy ratio (CAR) meetsthe requirements set by the State Bank in Circular 41/2016/TT-NHNN, whichstipulates the CAR of commercial banks and branches of foreign banks must reachBasel II standards from January 1, 2020. Eighteen banks have satisfied Basel IIstandards so far, including 16 domestic and two foreign institutions.
Basel II has the highest capital-relatedstandards and is applied in many countries to minimise business risks for banksand consolidate financial systems. They help commercial banks ensure theircapital indexes, liquidity and risk management meet international standards,thus helping to strengthen the financial – credit system.
8. Boomof private airlines
On January 16, Bamboo Airways officially enteredthe Vietnamese aviation market with its first commercial flight linking Ho ChiMinh City with Hanoi. It’s been eight years since Vietnam witnessed theappearance of a new airline, starting up competition for domestic market shareamong carriers. Firms such as Vinpearl Air JSC, Vietravel Airlines Co. Ltd,Vietstar JSC, and Thien Minh Aviation JSC (Kite Airlines) are also completingprocedures to begin operations.
Besides, many businesses have also invested inaviation manpower training with the establishment of the Bamboo AirwaysAviation Training Institute, VinAviation High-tech Human ResourcesTraining School, and Vietjet Aviation Academy.
9.Opportunities to make breakthroughs in Fourth Industrial Revolution
On September 27, the Politburo issued Resolution52-NQ/TW on guidelines and policies for the active participation in the FourthIndustrial Revolution (Industry 4.0). The resolution looks to make use ofopportunities generated by Industry 4.0 to promote growth model reform,economic restructuring, implementation of strategic breakthroughs, and nationalmodernisation. It targets that by 2045, Vietnam will become one of the leading centresin Asia for smart production and service, startup and innovation. Theresolution demonstrates the country’s activeness in taking part in therevolution.
10. Workstarts on eastern North – South Expressway
On September 16, Prime Minister Nguyen Xuan Phucmarked the start of construction of the Cam Lo – La Son Expressway traversingthe central provinces of Quang Tri and Thua Thien-Hue. It is the first of 11sub-projects for the eastern North – South Expressway project, which is apriority in the 2017-2020 period and has total investment capital of 118.716trillion VND (5.15 billion USD), including 55 trillion VND from the statebudget and the rest from other sources. With a total length of about 654km, theproject will play an important role in easing pressure on National Highway 1,improving the transport infrastructure system, and creating more momentum forsocio-economic development./.
VNA
