Economic growth in 2021 relies on innovation and creativity

Last year saw the entire global economy heavily impacted by the COVID-19 pandemic, with many countries recording negative growth, such as the United States whose economy contracted by 5.9%, the UK with a decline of 6.5%, and the EU with a fall of 7.5%. In addition, many Vietnamese sectors such as services, tourism, and transportation also suffered from the negative impacts of the COVID-19 pandemic.

Despite these challenges, the Government's management to meet the dual goal of both effectively combating the pandemic whilst ensuring socio-economic development served to remove difficulties for production and business activities, allowing the nation to be one of the few countries to achieve positive growth of 2.91%.

Assoc. Prof. Dr. Bui Nhat Quang, president of the Vietnam Academy of Social Sciences, said that 2021 marks the beginning of a five-year socio-economic development plan running from 2021 to 2025, and the 10-year socio-economic development strategy up to 2030. Therefore, this year is of great significance to future economic development. The assessment of the Vietnamese economic situation in 2020 plays an important role in drawing lessons that can be used in 2021 and ahead in the next period as a way of meeting the goal of rapid and sustainable economic growth.

According to experts, requirements within the current context is that the State and the Government must provide sufficient support for local firms once the pandemic is over. In particular, bailout packages and have to be properly taken into account in order to increase efficiency.

This year is likely to see the COVID-19 pandemic remain complicated worldwide, although positive signs are gradually brightening with preventative vaccines already being distributed in some countries. A research group of the Vietnam Economic Institute have therefore outlined three scenarios for Vietnamese economic growth in the year, with base economic growth of 5.49%, low growth of 3.48%, and high growth of 6.9%.

Ly Dai Hung from the Department of Macroeconomics and Economic Institution under the Vietnam Institute of Economics believes that this year will see the country start to carry out its economic development strategy for following five and 10 years, meaning that this is a vital time for the national economy.

“We have given three forecasting scenarios, which accentuate the base scenario that the national economy is able to grow at a rate of 5.49% in 2021,” Hung stated.

Some experts believe that the country will be enjoying the highest level of growth, but bottlenecks in the economy must be drastically removed. Indeed, there must be renewed thinking and reform in institutions and policies as a means of creating a favourable environment that is able to encourage and draw the participation of the non-state sector.

Furthermore, it can be viewed as necessary to mobilise necessary resources for investment in science, technology, and innovation, including breakthrough experiments on institutions and policies, they emphasized.