ADB optimistic about Vietnam's economic prospect despite slowdown

 

The ADB has revised down Vietnam's 2021 GDP growth forecast from 6.7 percent to 3.8 percent due to a resurgence of the COVID-19 pandemic that has tightened the labour market, lowered industrial output, and disrupted agricultural value chains, according to a report released by the bank on September 22.

 

At a virtual press conference, ADB country director Andrew Jeffries said the prolonged COVID-19 pandemic and extended lockdowns have weakened consumption and investment, hampering Vietnam’s growth prospects. “But the Vietnamese economy will bounce back if the COVID-19 pandemic is brought under control by the end of 2021 and 70 percent of the country’s population are vaccinated by the second quarter of 2022," he said.

ADB remains bullish on the country’s prospects in the medium and long term. Growth could be aided by a revival of domestic demand, an acceleration in the disbursement of public investment, and an expansion to new export markets thanks to multiple free trade agreements and the expected global economic recovery.

 The country’s economy is expected to grow 3.8 percent this year and 6.5 percent in 2022, according to the Asian Development Outlook (ADO) 2021 Update.

The ADB representative recommended that the growth prospects in 2021 and 2022 depend on the timely and adequate supply of essential items such as foodstuff and cash to those affected by the pandemic.

He recommended that Vietnam can benefit from removing administrative hurdles to business and people, and accelerating digital transformation, which will help improve the efficiency of pandemic containment measures and support a sustainable economic recovery this year and next./.