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| Assoc. Dr. Pham Tat Thang |
How do you assess Vietnam’s economic situation in the last months of the year and especially in 2022? What specific risks will Vietnam face that may affect economic growth?
2021 is the second year in a row that Vietnam has failed to achieve its GDP growth target. Meanwhile, 2022 is an important year, creating a foundation for implementing the goals of the five-year plan in 2021-2025. The growth pressure accumulated in the next four years is huge when it has to achieve an average growth rate of 7-7.5% per year, in which, the economy will have to accelerate very quickly in three years from 2022-2024.
Therefore, in order to recover and achieve the growth target as set out in the five-year socio-economic development plan for the 2021-2025 period, disease control is a prerequisite for growth.
However, if we do not carefully calculate, anti-pandemic solutions can affect production and business. The good news is that the Government is directing the application of measures to ensure the “dual” goal of pandemic control and growth recovery.
Regarding the risks that will affect economic growth in 2022, it can be seen that the Covid-19 pandemic may continue to be more complicated and dangerous. In addition, world economic growth is uneven, unstable and lower than 2021, which also increases risks in economic growth during this period.
In the country, experience, capacity and ability to cope with the pandemic have been improved, but the resilience and resources of the State, businesses and people have decreased. The risk of slow economic recovery and growth slowdown still exists if the pandemic is not controlled fundamentally to reopen the economy. Besides, risks of inflation, natural disasters and climate change are always present.
It is said that, in 2022, we will face inflationary pressure, what is your opinion on this?
It is true that although inflation is at a low level, an uptrend is present. Policies to support price reduction of some services (electricity, water, education) have helped reduce the consumer price index (CPI), but those solutions will not be maintained forever. Meanwhile, the prices of gasoline and raw materials have been increasing.
However, in my opinion, the inflation risk will exist in the fourth quarter of 2021. In 2022, the target of controlling inflation below 4% is not too concerning. Because the world economy is gradually recovering, along with the recovery of Vietnam’s main export markets, this will create conditions for Vietnam to control inflation below 4% in 2022.
In your opinion, what policies should Vietnam implement to adapt quickly so as not to miss the recovery momentum in 2022?
In order to have a good policy response at the macro and micro level, it is necessary to properly and clearly identify the weaknesses.
It is time for localities to be aware of the true nature of the pandemic to get rid of excessive fear, get out of the “local safety” mentality, and go against the requirement of undivided administrative cuts of the market economy. It is necessary to put the economic growth measures of each locality in the overall program of economic recovery and development, improving the internal capacity as well as the autonomy of the economy. Since then, there have been flexible adaptation measures to the complicated developments of the pandemic, natural disasters and the international environment.
I think Vietnam’s growth prospects in the medium and long term can be supported by the recovery of domestic demand, accelerated disbursement of public investment capital, expansion of operations into new export markets thanks to trade agreements, and the recovery of the global economy.
In particular, the recovery of Vietnam’s economy depends heavily on the vaccination strategy, so it is necessary to accelerate the progress and scale of vaccination in provinces and cities across the country, thereby helping the economy to return to the state of circulation of goods as well as people.
Looking at the number of businesses withdrawing from the market in the first nine months of the year, it is easy to see that businesses are currently facing many difficulties. From an expert’s perspective, what recommendations and suggestions do you have for businesses to overcome the pandemic soon?
This is an important stage, it is necessary to implement many strong measures to support businesses. These solutions require early access for businesses and must be very practical.
Doing this, the first point of support is to help businesses survive the pandemic. To do so, the solutions must be synchronous, the support measures must reduce costs and reduce difficulties for enterprises in production and business activities.
In terms of credit, it is necessary to build more credit packages to make it easier for businesses to access them, with the lowest cost of capital, the lowest loan interest. Because banks have to do business, this stage desperately needs the support of the State to solve between two groups of businesses – that is, the group of businesses dealing in currency (banking) and the group using money. In particular, what businesses need most is a direct cash support package, with simple and correct conditions.
It should be added that, the State has made great efforts to find and implement solutions and support for businesses and employees. But in the condition that the State is not really rich and has to spend on many things, it is very necessary to mobilize a lot of social resources towards businesses and workers.
For example, the resources that help employees of enterprises are also contributing to helping businesses maintain and retain employment positions. After we have controlled the pandemic, those businesses will not “stumble” with labor shortage and can immediately start production.
Thank you very much!