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IMF hails Vietnam’s moves to cushion COVID-19 impacts

The Executive Board of the International Monetary Fund (IMF) has highly valued Vietnam’s policy support to cushion the impact of COVID-19 in tandem with successful maintenance of fiscal, external, and financial stability and an impressive vaccination rollout.
IMF hails Vietnam’s moves to cushion COVID-19 impacts ảnh 1A COVID-19 vaccination site in Hanoi (Photo: VNA)
Tokyo (VNA) - The Executive Board of the InternationalMonetary Fund (IMF) has highly valued Vietnam’s policy support to cushion theimpact of COVID-19 in tandem with successful maintenance of fiscal, external,and financial stability and an impressive vaccination rollout.

In a press release following a recent consultation with Vietnam, the IMF Executive Board said a recovery isunderway and high frequency indicators point to stronger momentum going into2022, with rising retail sales, industrial production, and firm entry. Growthis expected to reach 6% in 2022 as activity normalisation continues and theprogramme for recovery and development is implemented.

However, the recovery of the labourmarket is lagging as underemployment remains high. While inflation has recentlypicked up due to rising commodity prices and supply-chain disruptions, itremains well below the central bank’s inflation ceiling.

The Executive Board calledfor agile policy making, proactively adjusted to the pace of the recovery andevolution of risks.

IMF hails Vietnam’s moves to cushion COVID-19 impacts ảnh 2IMF predicted Vietnam's growth will reach 6% in 2022. (Photo: VNA)
They also underscored theneed for fiscal policy to take the lead and be flexibly adjusted to evolvingeconomic conditions. They welcomed the programme for recovery and developmentand emphasised the importance of targeting, spending efficiency, and steadfastimplementation.

The IMF executive board stressed theneed for monetary policy to be nimble and vigilant of inflationary risks. Theyalso emphasised the importance of addressing problem loans, normalisingregulatory forbearance in a timely fashion, and closely monitoring real estatesector risks.

They welcomed Vietnam's recent stepstowards greater exchange rate flexibility and monetary policy modernisation andencouraged continued efforts in this direction.

The board stressedthe importance of structural reforms to improve the business environment,enhance productivity, and boost potential growth. They also praisedVietnam’s ambitious environmental agenda and urged the translation of targets intoconcrete policy actions./.
VNA
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