Illustrative image. Source: VNA

The Ministry of Planning and Investment estimates the country's GDP growth in 2021 at 3-3.5%, down 0.5 from the forecast in September, reported VnExpress Sunday.

"The new forecast is made on the basis of socio-economic performance results in the first nine months and prospects for the last three months of this year," Deputy Minister of Planning and Investment Tran Quoc Phuong said Saturday.

He said GDP growth for the whole year may reach 3% or 3.5% if the fourth quarter’s economic growth surpasses 7.06% or 8.84 %, respectively.

While a fourth quarter GDP growth of 7% of more has been achieved in the past, Phuong said this year’s figure would depend a lot on the effectiveness of pandemic control.

He said to achieve the growth targets, businesses must safely bring back their workforce when resuming operations and sustain production in the "new normal" situation. Smooth circulation of goods as input and output is also necessary to support growth, he added.

"In the next phase of production recovery, if businesses and manufacturing can recover 80% of their capacity, it would be a great success," Phuong said.

Vietnam’s GDP shrank by 6.17% in the third quarter. In the first nine months, the GDP grew by 1.42% as against 2.12 percent in the same period last year.

The GDP growth last year was 2.91%, the lowest in a decade, but Vietnam was one of the few countries in the world to achieve positive growth.

Prime Minister Pham Minh Chinh speaks at the meeting. Photo: VNA

At a Saturday cabinet meeting, Prime Minister Pham Minh Chinh emphasized that this year's economic growth will largely depend on fourth quarter production and business recovery as well as safe adaptation and pandemic control.

He requested the Ministry of Planning and Investment to quickly complete a strategy and plan to restore and develop the economy in the "new normal."

New programme

The Ministry of Planning and Investment (MPI) is coordinating with relevant ministries, sectors and localities to study and build a recovery and development programme in association with improvement of the economy’s internal capacity and self-reliance by 2023, with a goal to achieve an annual average GDP growth rate of 6.5-7% during 2021-2025, VNA reported.

According to the orientation of the Party and National Assembly by 2025, Vietnam will become a developing country which will have a modernity-oriented industry, surpass the lower-middle-income level, and achieve an annual average GDP growth rate of about 6.5-7%.

To that end, the MPI said that the programme needs to come up with specific solutions associated with accompanying resources, and in accordance with the capacity of the economy, and the state budget balance.

The Government should have health-related solutions to proactively adapt safely, flexibly to and effectively control Covid , and issue policies that can help reduce production costs, facilitate product sale and distribution, an develop logistics.

According to Minister Nguyen Chi Dung, the implementation of the programme should be long enough to be able to build and carry out measures to create a strong and solid foundation for the recovery of businesses and the economy.

In the immediate future, Dung suggested the Government step by step promote sustainable economic growth on the basis of overcoming the pandemic; improve the capacity of the health system and identify it as an urgent solution from the beginning of 2022 to create a foundation for sustainable economic recovery and development; maintaining macroeconomic stability; curb inflation; continue to implement reasonable expansionary fiscal and monetary policies; and ensure national financial safety.

Ministries, sectors and localities need to perfect institutions, administrative reforms and business conditions to remove difficulties and obstacles in production and business, and at the same time improve the efficiency of the government apparatus at all levels, restore and develop the tourism industry, stimulate domestic consumption, and enhance trade promotion, he stated.

The minister also proposed the Government support the recovery of businesses in a number of priority industries by providing credit and financial support through interest rates, tax and fee exemptionư and reductionư; developing sustainable supply chains, especially in manufacturing and agriculture; and supporting digital transformation.

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