Vietnam's economy has a large openness, so it suffers from many intertwined impacts

VCN - According to Ms. Nguyen Thi Huong, Director General of the General Statistics Office, in the first six months of 2022, Vietnam's socio-economic development has achieved many positive results. Most industries and fields tended to recover and grow again. However, achieving the full-year growth target of 6.5% is a big challenge.
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Ms. Nguyen Thi Huong, General Director of General Statistics Office.
Ms. Nguyen Thi Huong, General Director of General Statistics Office.

In the first six months of the year, the number of enterprises withdrawing from the market accounted for a high proportion. To support enterprises to overcome difficulties and stabilize and develop production, what solutions does the General Statistics Office propose, madam?

The General Statistics Office proposed the Government take quick measures to stabilize gasoline prices; at the same time, there are policies to support businesses that use a high proportion of petrol; ensure the circulation of goods takes place normally without interruption.

In addition, ministries and branches seek and expand export markets, and support export taxes and fees; at the same time, continue to mobilize workers to return to work, contributing to the economic recovery.

Local authorities create favorable conditions and support for businesses to build accommodation for workers when they return to work, support workers who have to stop or lose their jobs.

In addition, the Government has appropriate policies for credit institutions to concentrate capital and create favorable conditions for small and medium-sized enterprises to access capital; at the same time, quickly deploy support packages for businesses and workers in the program of socio-economic recovery and development under the Government's Resolution 11/NQ-CP.

Supply chain disruptions and the Russia-Ukraine conflict has pushed up inflation. In your opinion, will Vietnam's economy continue to avoid the problem?

In the future, the price movement of goods and raw materials will continue to increase sharply in the context of the complicated Russia-Ukraine conflict, causing disruptions to the supply chain, especially the pressure of gasoline prices creating a great force on production costs of enterprises and consumption.

Along with the impact of support packages to boost growth, Vietnam's economy is likely to recover more strongly in the remaining months of the year, increasing consumer demand for goods and services will push up commodity prices. But with the experience of the Government, I believe that we can control inflation according to the target set by the National Assembly.

Recently, the World Bank (WB) and the International Monetary Fund have both reduced their forecasts for world economic growth, predicting that the Asia-Pacific region may fall into stagnation. With the economic growth of the first six months of the year and the large openness of Vietnam's economy, in your opinion, is the economic growth target set at 6-6.5% this year positive?

On June 8, the Organization for Economic Co-operation and Development (OECD) warned that the world economy will suffer severe consequences due to the impact of the conflict in Ukraine, causing a sharp increase in energy and food prices while reducing the economic growth forecast in 2022 and raising the inflation forecast. Accordingly, the OECD forecasts that global GDP will grow by 3% in 2022, down sharply from 4.5% made in the forecast in December 2021.

In its Global Economic Outlook report, dated June 7, 2022, the World Bank revised down its global growth forecast for 2022, from 4.1% to 2.9%. Previously, in April, the International Monetary Fund forecast that global economic growth this year and 2023 will only reach 3.6%, down 0.8 and 0.2 percentage points respectively compared to the forecast. The report was published in January 2022.

The main factors leading to the slowdown in world economic growth include rising food and fuel costs. Western sanctions on Russian energy have led to an increase in oil and gas prices worldwide.

Apart from the disruption in the supply of many important goods such as agricultural products, fuel and metals from Russia and Ukraine cause prices to increase. China's "Zero Covid" policy affecting the global supply chain is also the reason why the prospect of world economic recovery after two years of the pandemic is increasingly difficult.

In that context, Vietnam seems to be going against the trend when it still maintains a fairly high growth rate in the second quarter of 2022 when GDP growth is 7.72%, up 0.99% compared to the same growth rate in 2021. The lifting of restrictions, the opening of borders and the reopening of international tourism activities have created new vitality in Vietnam's service sector.

In which, the strong recovery of the accommodation and food service industry must be mentioned with an increase of 25.92%; administrative activities and support services increased by 16.65%; art and entertainment activities increased by 14.01%; other service sectors increased by 16.61%; financial activities, banking and insurance increased by 9.17%; and wholesale and retail activities increased by 8.34%.

Generally, in the first six months of the year, the country's GDP increased by 6.42% over the same period last year; in which the major contributors to growth all grew quite well such as processing and manufacturing up 9.66%, financial activities, banking and insurance increased by 9.5%, accommodation and food services increased by 11.19%, transportation and warehousing increased by 8.13%, wholesale and retail increased by 5.82%.

However, Vietnam's economy has a large openness, so it is affected in many ways by the world's political situation. The price movement of goods, raw materials in the world continues to increase sharply, causing disruptions to the supply chain, especially the price of gasoline, which puts great pressure on the production costs of businesses and consumers.

Therefore, the 6.5% growth target set for 2022 is a big challenge when the domestic economy recovers positively but the target has not been achieved as expected because production and business activities are still facing difficulties, it is necessary to delay the recovery.

Therefore, I believe that the whole political system needs to drastically and effectively implement economic recovery support packages, actively follow the situation, do well in forecasting and developing scenarios in order to have management measures with arising situations.

The close coordination in the implementation organization of all levels and sectors and the determination, efforts and flexibility of businesses and people will be important factors for Vietnam's economy to achieve growth as set.

By Xuan Thao/Bui Diep

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