Vietnam has controlled COVID-19 and resumed economic activities (Photo: VNA) New Delhi (VNA) – The economic prospect of Vietnam is bright and the country’s economic growth story is like a “miracle”, S D Pradhan, deputy national security adviser of India, commented in a recent article run by Times of India newspaper.
In the article, the author held that despite the COVID-19 pandemic, Vietnam is forecast to be one of the fastest-growing economies in South East Asia. He cited the ADB’s Asian Development Outlook 2020 report published on April 3, 2020, that Vietnam’s economic growth will decline sharply to 4.8 percent in 2020 but bounce back up to 6.8 percent in 2021, provided the pandemic is contained.
A report by Standard Chartered forecasts that Vietnam’s GDP is on course for 7 percent growth through the 2020s – and will surpass the 10,000 USD per capita GDP mark in 2030. This is a remarkable growth story, he commented.
Vietnam has emerged as one of the favourite destinations for FDIs in Southeast Asia with FDI inward flow having increased year-on-year since 2011, reaching 19.5 billion USD in 2018, up from 17.1 billionUSD in 2017.
In addition, despite an average year-on-year minimum wage growth rate of 8.8 percent between 2015 and 2019, the manufacturing costs in Vietnam remain highly competitive.
The author asserted that socio-political stability combined with policymakers who continue to seek removal of restrictions on businesses by initiating reforms enabling foreign companies to open up businesses in the country have helped Vietnam attract significant business from abroad. It has increased infrastructure investment, promoted FDIs, increased education and R&D budgets, enhanced trade integration, and improved institutions and policies.
He noted that Vietnam took necessary measures to deal with the business crisis caused by the COVID-19 pandemic, which adversely effected business in the country.
However, S D Pradhan held that there would be a number of challenges for Vietnam to deal with, addingurgent efforts would be needed to develop the country as the manufacturing hub./.
