WB Lead Economist: Viet Nam is still an attractive economy

9:03:06 AM | 1/4/2022

Viet Nam is still an attractive economy as labor is not only cheap but productive while people are working a lot. The country also has tax incentive and many assets which make companies decide to come to Viet Nam, said World Bank Lead Economist and Program Leader for Viet Nam Jacques Morisset.

Regarding recommendation for the Government of Viet Nam to speed up the recovery and gain the growth for the next year, Jacques Morisset said that the first response is obviously depending on the pandemic. If the Vietnamese Government is able to control COVID-19, the nation continues to reborn.

The Government is doing whatever it can, and actually it’s doing very well. The vaccine shoot rate increased very much in the last few months. Actually, Viet Nam was able to vaccinate over one million people per day, which is such a certain world record.

The country is doing so far restoring or putting the engine back and rolling the production facilities. Export, manufacture and production are booming again. It's higher than it was a year ago which is incredible.

It is feasible for Viet Nam to reach a GDP growth rate between 6 percent and 6.5 percent. The country is projected to go back the growth trajectory that was before the COVID-19 crisis if the world and Viet Nam will not suffer anymore from big COVID-19 crisis, he emphasized.

Referring to opportunities for Viet Nam to boost economic recovery next year, Jacques Morisset said that Viet Nam has been very good at grabbing all the opportunities at the best that it can.

The first come at export sector and export is partly determined by multi-national and Foreign Direct Investment (FDI) while 80 percent of export value in Viet Nam is from FDI companies, he said, adding that the Vietnamese economy has a big attraction for multi-national and FDI.

The pandemic has demonstrated that it would be good to diversify supply chains and Viet Nam is a good candidate to diversify. Some big companies are coming to Viet Nam to diversify because it maybe exports to a few other countries. The nation can still take advantage of this competition advantage.

Meanwhile, Viet Nam can take advantage of its green economy or its climate change economy.  Viet Nam is the victim of the climate change but it can be also taking advantage of climate change.

Last year, the government subsidized the price of solar to help company to invest in solar. The reaction of the private sector has been amazing. The investment in solar power projects in eight months of 2020 in Viet Nam is higher than a full ASEAN countries and full African continent.

So it shows that the country has future in green energy and renewable energy because what it did for solar it can do it for wind, for battery and for more green products. It shows as well the vibrancy of the private sector in Viet Nam. It is the strength of the Viet Nam’s economy, and it’s not only now but also the evolution for the last two year, the vibrancy and the ingenuity of Vietnamese entrepreneurs.

Regarding the WB’s US$221.5 million-support package for Viet Nam, Jacques Morisset said that the package will help Viet Nam in the effort to recover from COVID-19.

He stressed the importance of digital financing and digital money, adding that the WB tries as well to help the government in the effort to continue to be inclusive. It’s about the fact that making sure that all people as the part of the economy can suffer less from the pandemic but take advantage of digital opportunities.

It is also about green recovery and to make sure that the future investment, future operation in Viet Nam will be taking care of climate change and climate change’s risks.