Vietnam’s top 10 economic events in 2021
Vietnam’s top 10 economic events in 2021
Vietnam Economic News lists the 10 most outstanding events of the Vietnamese economy in 2021.
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1. Vietnam achieves growth, draws foreign investment despite pandemic
The fourth wave of Covid-19 heavily affected socioeconomic life, but Vietnam nonetheless achieved and exceeded some economic targets. The gross domestic product (GDP) grew more than two percent; foreign trade value exceeded US$660 billion, up 22.4 percent year-on-year, adding Vietnam to the list of the world’s top 20 countries in terms of international trade. Vietnam’s trade surplus reached about US$4 billion and foreign direct investment (FDI) totaled US$31.15 billion, up 9.2 percent compared with 2020.
2. National Assembly issues resolutions on economic development
On July 28, at the first session of the 15th-tenure National Assembly (NA), the NA issued Resolution 30/2021/QH15 tasking the government and the prime minister with finalizing and implementing measures which had not been regulated or differed from existing laws and ordinances to meet urgent requirements of Covid-19 prevention. On November 12, at the second session, the 15th-tenure NA approved the resolution on the economic restructuring plan for the 2021-2025 period. The resolution calls for a suitable and efficient economic structure, development of national products based on new and high technology, breakthroughs in the competitiveness of key economic sectors, and enhancement of economic self-sufficiency, adaptability and resilience.
3. Government adopts flexible pandemic prevention policy
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In early October, the government issued Resolution 128/NQ-CP, changing the pandemic prevention strategy from “zero Covid” to safe adaptation to the pandemic. This important resolution reflected the government’s flexibility and creativity in coping with the new developments of the pandemic and contributed significantly to promoting economic recovery while continuing efforts to prevent Covid-19 spread.
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4. Digital transformation - a driving force of economic growth
In 2021, the 13th National Congress of the Communist Party of Vietnam identified digital transformation as a driving force of economic development. Covid-19 also motivated digital transformation. To promote digital transformation, it is necessary to synchronize digital institutions, infrastructure, production tools and management tools, digital human resources, market, and legal management in order to build a healthy digital environment and ensure effective management of risks on network spaces.
The government issued guidelines for accelerating digital government, digital economy, and digital society, with specific measures to promote digital transformation in the customs, banking, taxation, securities, and insurance sectors.
5. Vietnam maintains firm position in global manufacturing, supply chains
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In the context of Covid-19 and unfavorable changes in the global economy seriously affecting manufacturing and supply chains, Vietnam maintained its firm position as a bright spot in global manufacturing and supply chains. Major world investors continued affirming their commitments to maintain stable production and expand operations in Vietnam.
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6. Explosive growth of securities market resulting in major money flows
In 2021, the Vietnamese securities market achieved unprecedented records in terms of market points, liquidity and the number of new accounts. Notably, domestic investors were a major factor contributing to these historical records. Also in 2021, the Vietnam Stock Exchange (VNX) officially made its debut, holding 100 percent of the charter capital of the Hanoi Stock Exchange (HNX) and Ho Chi Minh Stock Exchange (HOSE).
7. Vietnam removed from currency manipulator list
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Following extensive efforts by the Vietnamese government, ministries and sectors, the US Department of the Treasury announced that there was insufficient evidence to conclude Vietnam was a currency manipulator, and did not impose any commercial sanction on Vietnam. These efforts helped Vietnam avoid economic losses and strengthened foreign investor trust in Vietnam’s stable and attractive investment environment.
8. CPI growth lowest since 2016
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The consumer price index (CPI) grew 1.84 percent in 2021 compared with 2020 - marking the lowest inflation level in the past five years. This CPI growth reflected the continued control of major macroeconomic balances at a better level compared with previous years. However, it also meant weak purchasing power as a result of Covid-19.
9. Bilateral FTAs improve quality of Vietnam’s international integration
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The year 2021 marked the 15th anniversary of Vietnam’s World Trade Organization (WTO) membership with many bilateral free trade agreements (FTAs) taking effect, helping Vietnam promote foreign trade.
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10. State revenues soar despite numerous difficulties facing the economy
According to data announced by the Ministry of Finance on November 30, 2021, state budget revenues reached VND1,390 trillion, exceeding the annual estimate by 3.7 percent and up nearly nine percent compared with the same time in 2020. Revenue from domestic sources exceeded annual estimates by nearly one percent and increased more than six percent compared with the same time in 2020 (in 2020, the index decreased nearly seven percent compared with 2019). This was the first time the annual state budget revenue plan was completed ahead of schedule.
