Vietnam Successfully Withstands "Headwinds"

Despite headwinds, Vietnam managed to show strong performance in the first nine months of this year, posting a gross domestic product (GDP) growth of 4.24%, said Deputy Minister of Planning and Investment Tran Quoc Phuong.
October 08, 2023 | 11:27
Vietnam Successfully Withstands
Deputy Minister of Planning and Investment Tran Quoc Phuong.

The Government Portal on October 5 organized a discussion on Vietnam's economy overcoming "headwinds," with the participation of leaders of state management agencies, international organizations, and domestic and foreign economic experts.

Vietnam is stronger after the pandemic

Deputy Minister of Planning and Investment Tran Quoc Phuong said that the outstanding result in the past nine months is the GDP growth rate of 4.24%. This is a quite high result compared to other countries.

The Deputy Minister mentioned "bright spots" for the economy to overcome "headwinds."

These include flexible and effective monetary management, price management, inflation control, and public investment capital disbursement.

"In many years, rarely in any year after nine months has the disbursement result reached over 50%," said Deputy Minister of Planning and Investment.

Phan Duc Hieu, permanent member of the National Assembly (NA)'s Economic Committee, added some bright points such as the National Assembly and the Government have issued many policies to support people and businesses both institutionally and financially.

This includes tax reduction, tax exemption, and extension of financial obligations of about VND150 trillion (US$6.14 billion).

Along with that are the efforts of the Government, businesses, people, and localities to reduce difficulties and overcome challenges.

"I see that the business community is conscious in its efforts to overcome difficulties and challenges without relying on the Government," Hieu said.

Phan Duc Hieu also praised the Prime Minister for strongly directing the shift towards a flexible and appropriate loosening of monetary policy.

"These are drastic, strong, and decisive actions of the Government," Hieu said.

Dr. Vu Minh Khuong, a lecturer at Singapore's Lee Kuan Yew School of Public Policy, also agreed with Deputy Minister Tran Quoc Phuong as well as NA's Economic Committee member Phan Duc Hieu for bringing up some sharp and clear facts on the issue.

“Observing whether Vietnam has become stronger after the pandemic is an issue that many international researchers and politicians are interested in. And it's clear that Vietnam has become stronger after the pandemic," he said.

According to Khuong, over the past two years, confidence in the Government's management in the context of an extremely difficult global economy increased strongly, both externally and internally.

Vietnam Successfully Withstands
Dr. Vu Minh Khuong, a lecturer at Singapore's Lee Kuan Yew School of Public Policy.

"The localities as well as the large businesses I work for all have a new mindset and are ready for the future. In a simple issue like rice export, Vietnam is brave, which the world is praising. This is the Government's bravery in recent times," Dr. Vu Minh Khuong said.

In terms of macroeconomic management, Khuong said that, in the context of risks, our economy is only in the initial stages, with many difficulties. However, we are steadfast in managing exchange rates and interest rates, there are no problems at all. That is good news for the economy.

According to Vu Minh Khuong, the Government's management in recent times helped make localities strong, such as the decision to build 218 kilometers of subways and urban railway systems in the next 12 to 15 years.

He also said that economic model innovation cannot happen in a day or two. Therefore, the Government's role is required in the coming time.

"I have gone through the first reform period, and in this second reform period, although there are countless difficulties and challenges, it is clear that new horizons are opening up," Khuong said.

Dr. Vu Minh Khuong believed that we are standing at the threshold of an era in which Vietnam can take off to become a developed country in the near future.

"The US President's recent visit to Vietnam brought a lot of motivation, new industries, such as semiconductor chip production, which is a great opportunity for us."

Khuong believed that "Vietnam will take spectacular steps in the coming time."

Government chooses the right and timely direction

Shantanu Chakraborty, Asian Development Bank (ADB) country director in Vietnam, said that the current "gaps" and shortages in infrastructure are still large, and Official Development Assistance (ODA) amounts are still limited.

Therefore, it is necessary to mobilize more resources from the private sector for infrastructure, especially infrastructure that is resilient to climate change. "In my opinion, it is necessary to reform economic incentive policies," he said.

"We appreciate the Government's policy responses, balancing macroeconomic stability along with supporting socio-economic development and promoting public investment.

Macroeconomic policies include fiscal and monetary measures. The Government has been on the right track and in a timely manner," said Shantanu Chakraborty.

In a report released in September, the ADB predicted that Vietnam will continue to take the lead in Southeast Asia with growth of 5.8% in 2023, lower than that of last year but still a good figure. Chakraborty held that the goal of a 6% in growth rate set by the Vietnamese Government is reachable.

Vietnam showed a positive pace in investment and public spending, while the State Bank of Vietnam performed its role in controlling inflation, he said, underscoring that compared to other regional countries, Vietnam gained encouraging achievements.

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