Although he reported his first case of COVID-19 on January 23, 2020, Vietnam reported only just over 300 cases and zero deaths in the following four months. This initial success is attributable to several key factors, including a well-developed public health system, a strong central government and a proactive containment strategy based on comprehensive testing, tracing and quarantine.
Regarding its response to the Coronavirus outbreak, Vietnam was among the first countries to close its borders and stop international flights. It also invested in tracing infections, testing for the virus, quarantining suspected and confirmed cases and effectively mobilized state agencies, thus lifting the lockdown as early as April 22nd.
Economically the Vietnam fared better than many nations, but he was not completely spared. In 2020, the pandemic limited travel, shut down manufacturing, and caused large-scale unemployment as businesses around the world suffered significant losses. The data shows the country's GDP grew by 1.81% in the first half of the year compared to a pre-COVID projection of 6.8%. This data, when compared to that of all ASEAN countries, is particularly interesting: Vietnam is the one growing the most in the area.
The domestic economy grew in August, but at a slower pace than in July and significantly lower than the rates recorded a year ago. Industrial production (ANS) grew 2.1% year-on-year in August, compared to 4.0% in July. Exports continued to perform well despite international headwinds, while FDI (Foreign Direct Investment) inflows slowed significantly. The World Bank then suggests paying attention to domestic and foreign investors, who may postpone their plans in the current context of uncertainty, as well as to the Government's response, which must stimulate recovery in the short term and preserve fiscal and debt sustainability in the long term.
In the immediate future, the Vietnamese economy will not be able to fully rely on its traditional growth engines (private consumption and foreign demand). Given the uncertainties of the domestic and international environment, traditionally risk-averse households will likely limit their investment and consumption plans, while exporters will continue to suffer from restrictions on international mobility and declining global income. THEThe tourism sector, for example, risks losing 20 million foreign travelers in 2020 alone.
Alessandro Fichera, Sole Director of Octagona, spoke about the current Vietnamese situation in an article for ISPI. Click here to learn more: “Vietnam: a country that reacts quickly“.
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