Economic recovery strongly in 2022 an important premise for 2023


Economic recovery strongly in 2022 - an important premise for 2023
Vietnam has achieved two goals: one is high growth, and the other is macroeconomic stability. Photo: Internet

Powerful recovery

According to the Government’s report, implementing the Socio-Economic Development Plan 2022 has achieved many outstanding results. As a result, the whole year is expected to reach and exceed 14/15 targets compared to the plan assigned by the National Assembly; economic growth is estimated at 8%, exceeding the set target (6 – 6.5%), creating an important momentum for economic growth in the next year, to realize the economic growth target of the five-year plan 2021 – 2025. Therefore, timely promulgation and focus on implementing the prevention and control program for the Covid-19 pandemic drastically and effectively.

General Director of HSBC Bank Vietnam, Tim Evans:

Economic recovery strongly in 2022 - an important premise for 2023

Despite global challenges, Vietnam has worked hard to achieve its economic goals. In fact, in the third quarter of 2022, Vietnam’s GDP increased by 13.67% over the same period last year, when the Vietnamese economy was severely affected by the strong outbreak of Covid-19. As a result, Vietnam’s GDP in the first 9 months of 2022 increased by 8.83%, the highest in the past 11 years.

Someone once said that America was the land of opportunities, and Vietnam was the land of people who create opportunities. This has been verified. Because the Covid-19 pandemic can be considered a “black swan” event and Vietnam has overcome this event well. At the same time, I believe that Vietnam will also handle new challenges well.”

The macro-economy is also stable; inflation is controlled, and major balances are ensured. GDP growth is higher than planned, and highly appreciated by prestigious international organizations. State budget revenue for the year is estimated to exceed 19.8% of the estimate, creating room in fiscal management to support growth, stability and improve people’s living standards. The money market is basically stable, interest rates, exchange rates and credit growth limits are appropriately managed, directing credit to priority industries and fields. Export turnover for the whole year is estimated at US$ 368 billion, up about 9.5%. It is the first time that import-export turnover has exceeded US$ 700 billion, continued to have a trade surplus of nearly US$ 20 billion. Realized FDI capital is estimated at US$ 21-22 billion, increasing by 6.4 – 11.5%. Total social investment capital for the whole year is estimated to increase by 10.7%, which is the driving force for the economy to accelerate the expansion of production capacity in the coming time. Price management is concerned and directed drastically, closely and effectively, especially for essential commodities, especially gasoline, oil, and textbooks. Economic sectors have good growth compared to 2021. The balance of electricity, petrol and food is guaranteed.

With the above convincing figures, it is clear that bright colours dominate our country’s economic picture.

Evaluating the above results, Dr Can Van Luc, chief economist at BIDV and member of the National Monetary and Financial Policy Advisory Council, said that in 2022, Vietnam’s economy recovered strongly in most fields and localities. Thanks to three main reasons, Vietnam promptly changed the state of fighting against the Covid-19 pandemic, creating conditions for economic activities to return to normal; persistently using many policies and solutions for economic recovery and macro stability, inflation control; and finally, the above growth indicators were correlated with the relatively low base level of the previous year.

In addition to the optimism and achieved results, the Government also pointed out the shortcomings and limitations, such as the remaining 1/15 of the expected target not being achieved, it was the growth rate of social labour productivity, which was estimated to increase by about 5 2% (target is 5.5%). Production and business activities still faced many difficulties, mainly due to the high price of petrol, raw materials, input materials, and high production costs. Furthermore, the disbursement of public investment capital continued to be a bottleneck, not achieving the expected results. In addition, the implementation of several policies under the Socio-Economic Recovery and Development Program was still slow.

Many optimistic prospects

Commenting on the impact of the world economy on Vietnam’s economy, Dr Vu Dinh Anh said that the growth rate of the domestic investment economy sector and the foreign-invested sector was quite good, so it ensured the supply of investment capital for the economy. Total retail sales of consumer goods and services in society were still growing at a double-digit rate.

Besides, thanks to export results, the trade balance continued to have a surplus. Thus, overall, in 2022, our country achieved quite good results, with only one “bottleneck” in growth related to the disbursement of public investment.

“We have achieved two goals: one is high growth, and the other is macroeconomic stability. If we determine that in 2022, the growth rate and inflation control will create the premise for a new growth cycle, along with making good use of opportunities, I think that regardless of the world economic situation in the face of a recession, Vietnam can still maintain a high growth rate, even above 8% per year in 2023”, said Anh.

According to experts, Vietnam is entering an important and decisive stage of development with the expectation of economic recovery and development in 2022 and 2023, creating a strong rebound for the whole period of 2021-2025. Despite facing many difficulties and challenges, in the short term, Vietnam has many optimistic prospects for high economic growth compared to the level before the Covid-19 pandemic. Therefore, identifying the context and challenges will help Vietnam take advantage of the potential and create a driving force for economic growth in 2023.

According to Andrea Coppola, World Bank (WB) chief economist in Vietnam, Vietnam’s positive economic performance in 2022 was driven by many key factors. Firstly, exports, which had been very strong in the past, have shown resilience even in times of crisis because of the Covid-19 pandemic, with exports of processed and manufactured products being the main growth engine.

Second, domestic demand. Domestic consumption and retail sales were the main growth drivers in 2022. Retail sales showed this in October 2022 recording a growth of about 17% compared to the same period in 2021. “We assess that Vietnam’s domestic demand is expected to be impacted by rising domestic inflation shortly, but will continue to contribute positively to the economic growth outlook in 2023”, Andrea Coppola analysis.

Third, investment plays an important role in Vietnam’s economy. From January to November 2022, FDI disbursement increased by more than 15% compared to the same period in 2021. As a result, Vietnam would be the leading economy in East Asia – Pacific region with an increase in growth of 7.2% in 2022 and 6.7% in 2023.

In 2023, the Government set targets on 15 key indicators in the fields of socio-economic and environmental. The overall objective is to continue prioritizing maintaining macroeconomic stability, controlling inflation, promoting growth, and ensuring major balances of the economy. Effectively control the Covid-19 pandemic and newly arising diseases. Accelerate restructuring, improve internal capacity, self-reliance, resilience and adaptability of the economy; determined to effectively implement with the best efforts the program of socio-economic recovery and development, 3 national target programs; promote innovation, green growth, and digital transformation. In which: GDP growth is about 6.5%; GDP per capita is about US$ 4,400; the proportion of processing and manufacturing industry in GDP is about 25.4 – 25.8%; the average CPI growth rate is about 4.5%; the average growth rate of social labour productivity 5 – 6%; the rate of trained workers is about 68%, of which degrees and certificates are about 27.5%; the unemployment rate in urban areas is less than 4%; the rate of poor households according to the multidimensional poverty line decreased by 1-1.5%.

(Source: excerpt from the Resolution on Socio-Economic Development Plan in 2023)


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