Different scenarios put Vietnam’s GDP growth at 3.5 to 6.1 percent

Different scenarios put Vietnam’s GDP growth at 3.5 to 6.1 percent

In the face of complicated developments of the Covid-19 pandemic in many localities across the country, Vietnam’s 6.5 percent gross domestic product (GDP) growth target will be hard to achieve.

Different scenarios

The Vietnam Institute for Economic and Policy Research (VEPR) announced three scenarios for Vietnam’s economic growth in 2021. Accordingly, if the pandemic is brought under control in late third quarter of 2021 and the country reaches community immunity in the second quarter of 2022, the national economy may expand by 4.5-5.1 percent. In the second scenario, the pandemic is controlled in August 2021 and community immunity is achieved in the first quarter of 2022, Vietnam’s GDP growth is projected at 5.4-6.1 percent. If the pandemic cannot be controlled and economic activities cannot return to normal by the last quarter of 2021, the Vietnamese economy is forecast to grow 3.5-4 percent.

Vietnam’s economic growth is forecast to be lower than the set target

Associate Professor Pham The Anh from the VEPR said the first scenario is the most likely, with a maximum growth rate of 5.1 percent, much lower than the 6.5 percent target set out in Resolution 01/NQ-CP.

The Central Institute for Economic Management (CIEM) also announced two economic growth scenarios for Vietnam this year. In the first scenario, with the pandemic brought under control by October 2021 and economic activities return to normal, Vietnam’s economy is forecast to expand by 5.9 percent. In the second scenario, if the pandemic is controlled by August 2021, Vietnam’s GDP growth is projected at 6.2 percent.

In addition to domestic research institutes, international organizations lowered their growth forecasts for Vietnam this year due to the resurgence of Covid-19 in the country and similar developments in other nations that complicate the recovery process.

High hope for mass vaccinations

Pham The Anh said economic growth in many countries around the world in 2021 is forecast to be brighter than a year ago. However, there is no uniformity in growth among countries. The US and the Republic of Korea are already back to their pre-pandemic levels, while European countries are expected to take about three years to bounce back. The emerging economies, such as China, Turkey and Russia, may take a longer time.

Vietnam is accelerating mass vaccinations

Anh also said economic recovery depends on the speed of mass vaccinations. For example, the US has achieved a vaccination rate of 120 doses per 100 people.

In Vietnam, the rate remains low, reaching about four million doses per 100 million people. The country is lagging behind in vaccinations, hampering economic growth in 2021 and 2022, Anh said.

Recognizing the importance of vaccines in repelling the pandemic and promoting economic growth, Governmental Resolution 21/NQ-CP dated February 26, 2021 on purchasing and using Covid-19 vaccines set a target of 150 million vaccine doses to vaccinate 70 percent of the population. To achieve the goal, the Vietnamese government adopted a vaccine diplomacy strategy that has yielded positive results.

According to the Ministry of Foreign Affairs, Vietnam has received enthusiastic support from partners, neighboring countries and international friends with total commitments of 150 million vaccine doses through purchases and aid.

VietNam Economic News