Vietnam records 847 trillion dong in losses due to Covid-19

Vietnam is estimated to have suffered an economic loss of about 847 trillion dong due to the ongoing coronavirus pandemic.

Its Central Economic Commission deputy head, Nguyen Thanh Phong, said the country’s economy was projected to have grown by seven per cent, if the pandemic had not come into play.

However, the economic growth rate only increased by 2.91 per cent in 2020 and is expected to increase by 2.5 per cent this year, Phong said during a forum on economic recovery plans.

According to a Vn Express report, he said the economic loss was equivalent to 847 trillion dong at current market prices.

To handle the depressed economy, he believes that it is necessary to have an economic recovery package with four key factors — investment, export, domestic consumption and digital transformation.

“The primary driving force for economic growth is investing to raise demand and supplies by encouraging domestic consumption.”

Vu Hong Thanh, chairman of the National Assembly’s Economic Committee, said the overall recovery package must focus on “stimulating” both the supply and demand.

He said the package must also be implemented quickly and coordinated, while being large enough and focused on industries and fields that could recover quickly and safely.

National Economics University vice-president Hoang Van Cuong said he was concerned about the effectiveness of the recovery package when implemented as the economy was experiencing slow capital disbursement.

Public investment disbursement was slightly above 70 per cent while credit growth was at around eight per cent, lower than expected.

Vietnam had already projected a growth of between six and 6.5 per cent in 2022 despite the likely challenges of the pandemic.

Its Minister of Planning and Investment, Nguyen Chi Dung, had previously listed the 16 main goals of the socio-economic development plan for next year, including containing inflation and the budget deficit at four per cent.

Despite the severe impacts of the pandemic on health, economy and society, the economy has remained stable this year, he had said in October.

The economy grew by 5.64 per cent year-on-year in the first half, but contracted by 6.17 per cent in the third quarter as the fourth wave of Covid-19 raged, leading to growth of only 1.42 per cent for the first nine months, he added.

He warned that the economy still faced potential risks such as a surge in prices and fall in exports.

There is a disruption of some production and supply chains while distribution of goods faces bottlenecks in some places.