Handsets are manufactured at a factory of Samsung Electronics Vietnam. Phones and components were still the items with the largest export value, reaching 36.78 billion USD, accounting for 18.16 percent of total export turnover in nine months (Photo: VNA) Hanoi (VNA) - The Vietnam Institute for Economic and PolicyResearch (VEPR) estimated local GDP growth for this year at between 2.6 percentand 2.8 percent at a workshop in Hanoi, lower than the 3.8 percent it forecastin July.
Pham The Anh, VEPR's chief economist, told the workshop, which said of thelocal macro-economic performance in the last quarter of 2020: “With anunfavourable scenario, the economy can grow only 1.8 or 2 percent.”
Releasing the report on the first nine months of 2020, Anh said Vietnam'seconomic prospects depended on the ability to control the pandemic not only inthe country but also around the world.
According to VEPR, factors that can support growth include the free tradeagreement and investment protection agreement between Vietnam and the EU (EVFTAand IPA), disbursement and construction progress of key public investment projects.
Anh mentioned the positive conditions including low-cost raw materials due todecreased demand for consumption, a stable macro environment, as well ascontrolled inflation at an average level, adding they were creating goodconditions for growth.
The report said Vietnam's trade surplus reached 16.52 billion USD, a record inthe past 15 years, thanks to strong exports, while imports decreased slightly.Specifically, the export turnover in nine months was estimated at 202.57billion USD. Phones and components were still the items with the largest exportvalue, reaching 36.78 billion USD, accounting for 18.16 percent of total exportturnover. Following were machines, equipment, tools and spare parts with 18.2billion USD, up by 39.8 percent. Import turnover was estimated at 186.5 billionUSD in the period.
However, he stated Vietnam was still facing many risks and challenges in anuncertain economic environment, adding: “The pandemic resurgence in many countrieswas accompanied by blockade measures that could prolong supply chain failureswhile geopolitical conflicts between major countries can expose an open economylike Vietnam to unexpected risks.”
Internal risks such as a large fiscal imbalance, low speed and level ofdevelopment investment, especially infrastructure and vulnerable health of thebanking and financial system, the dependence on the FDI sector, low quality oflabour, low efficiency of public investment and the delayed process ofequitisation of State-owned enterprises were mentioned in the report.
Anh said: “The current forecast is lower than our estimate in our previousreport due to the return of the pandemic in the central cities in July whichdisrupted the recovery of the tourism industry. Additionally, this includes amore unfavourable case when Vietnam's partner countries have to re-applyblockade measures.”
VEPR chief confirmed: "The toppriority now is to ensure social security, to keep the macroeconomicenvironment stable, to reduce the burden on businesses having to suspendoperations and support active businesses."
Anh said Vietnam must continue the support quickly to the right people,encourage to develop credit, give incentive policies, improve the institutionalenvironment for groups of businesses and speed up public investment.
The report also suggested Vietnam diversify import/export markets to avoidrelying heavily on a number of major economic partners, improve administrativeprocedures, the business environment, and build up a fiscal cushion to preventshocks brought by a crisis like COVID-19. /.
VNA
