Viet Nam's economy: Successfully overcoming 'storm' and waiting for a new rebound

Viet Nam is among countries with the highest economic growth in the world in the context of the Covid-19 pandemic.

Viet Nam is among countries with the highest economic growth in the world in the context of the negative impacts of the Covid-19 pandemic spreading on a global scale.

This is the common assessment of international media after the Vietnamese Government recently announced the official figures on the economic growth in 2020. Accordingly, Viet Nam's economy in 2020 still maintained its growth, reaching 2.91% thanks to good pandemic control and timely supportive policies for people and businesses.

Impressive growth in 2020

The Sputnik News Agency (Russia) quoted Professor Vladimir Mazyrin (Center for Viet Namese and ASEAN Studies of Institute of Far Eastern Studies of the Russian Academy of Sciences), saying that 2.91% is Viet Nam’s lowest growth rate in at least recent 3 decades, but it is actually "a great success", which will surely help Viet Nam climb a higher position in all world rankings next time.

It is also important that Viet Nam has outperformed China impressively, although this country is also experiencing 1% growth.

BBC television channel (UK) stated that the growth rate of Viet Nam's economy is higher than predicted by the World Bank (WB) or the International Monetary Fund (IMF). Meanwhile, the Business Times (Singapore) and Reuters (UK) shared the same viewpoint that strict quarantine and traceability measures helped Viet Nam quickly control the spread of the Covid-19 pandemic, helping economic activities recovered faster than many other Asian countries.

According to Daily Mail (UK), Viet Nam has long been among the fastest growing economies in Asia. Many economic activities still show positive signs in the context of the global recession caused by the Covid-19 pandemic. Large-scale quarantine, extensive exposure tracking and tightened travel controls have allowed factories to stay operational and people quickly back to work.

Recovery in 2021

According to Nikkei Asia (Japan), the six leading economies in Southeast Asia are expected to fluctuate, in which Viet Nam, Indonesia and Malaysia will bounce back to pre-pandemic levels, while Singapore, the Philippines and Thailand will struggle to return to the previous growth rate.

Nikkei summarized IMF's forecasts on the actual gross domestic product (GDP) of each country and used the data in 2019 corresponding to 100 points. Viet Nam, Indonesia and Malaysia all score above 100, at 202. It means that next year, the real GDP of these economies will be higher than it was before the Covid-19 outbreak broke out in 2019.

Viet Nam will lead the group of six economies, with growth forecast at about 108.4. S&P Global forecasts Viet Nam's real GDP will grow 10.9% in 2021, higher than any other country in the Asia-Pacific region.

In addition, Viet Nam is among six countries with real GDP growth in 2020 thanks to rapidly curbing the Covid-19 epidemic. The Vietnamese leadership has also effectively fostered demand through public investment projects implemented ahead of the Party Congress.

Like other countries, Viet Nam will continue to face uncertainties due to the pandemic and the upcoming government in the US. However, according to Yuta Tsukada, an expert of Japan Research Institute, “many companies in the world are flocking to Viet Nam, and this benefits the country's export performance”.

Due to low production costs in Viet Nam, more and more companies will switch operations from China to Viet Nam if the trade war between Washington and Beijing continues.

Due to low production costs in Viet Nam, more and more companies will switch operations from China to Viet Nam if the trade war between Washington and Beijing continues.

Prospect of Ranking 19th in 2035

The Center for Economic and Business Research (CEBR), a leading economics consultancy in the UK, recently released an annual report on 193 economies, forecasting that Viet Nam's economy will rank 19th in the world by 2035.

CEBR forecasts that Viet Nam's economy will grow at an average of 7% in the period of 2021-2025, 6.6% in the next 10 years and by 2035 it will surpass Taiwan (China) and Thailand.

“The next 15 years are set to see Viet Nam climb rapidly up the rankings of the World Economic League Table,” it noted, adding the country’s position will move from 37th in 2020 to 19th in 2035.

The report estimated by 2035, Viet Nam’s nominal GDP is estimated at US$1.59 trillion from the current US$341 billion, a nearly 5-fold increase in a 15-year span.

The report of CEBR confirmed that thanks to better control of the Covid-19 epidemic elsewhere in the world, Viet Nam's economic growth in 2020 will still stay positive, reaching 2.91% and among the highest in the world.

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