Worst of the virus crisis could be over in Vietnam

Vietnam is looking ahead for a tentative rebound of its coronavirus-hit economy as the caseload remained relatively low in recent days and drastic travel restrictions and lockdowns seem to work in curbing the spread of the disease.

Currently, the country has 85 confirmed cases of coronavirus–infected people, of which 16 have fully recovered and have been discharged from hospital.

The improving situation is seen as a result of Vietnamese officials reacting early to the virus by banning arrivals from China and ordering people suspected sick into quarantine instantly.

The country was also quick in quitting the issuance of visas to almost all foreign nationals for 30 days, starting March 18. Ho Chi Minh City authorities are also curbing meetings geared for more than 1,000 people, while cinemas, bars and entertainment venues are closed through March 31.

Government incentives for businesses rolled out

To support the economy, the government has rolled out incentives to revive companies including export manufacturers, a backbone of the economy that has grown around six per cent per year since 2012. The Vietnam government is also offering tax breaks, extending tax due dates and allowing delayed land-use fee payments to companies affected by the outbreak.

Furthermore, the central bank cut its benchmark refinance rate to five per cent from six per cent and the discount rate to 3.5 per cent from four per cent, a measure to mitigate the impact of the outbreak on banks and corporate finances in order to helping to minimise disruption and save jobs.

Factories in Vietnam are still operating, and export growth from January 1 through March 15 was 6.8 per cent over the same period of 2019, a remarkable figure given the doom-and-gloom prophecies of many analysts.

Exports to the European Union expected to drop

On the downside, the European Union’s decision to close its borders amid the coronavirus pandemic could reduce Vietnam’s exports to the bloc by up to eight per cent, the country’s trade ministry said. Though the ban on entry does not apply to goods, the ministry expects safety measures in Vietnam’s second largest export market after the US to slow down trade and consumption. Cargo shipped by air would face challenges due to restrictions on flights, while demand for export items such as textiles, footwear, computers and smartphones would be lower.

However, the economic toll of the crisis on Vietnam remains visible. Apart from airlines that halted their flights to infected destinations, industries including tourism, transport, electronics, agriculture and insurance are bearing the bunt. Many restaurants, shops, cinemas and entertainment places are also severely affected due to lack of the demand.

Government keeps GDP growth target unchanged

The Asian Development Bank estimated that Vietnam would lose 0.41 per cent of GDP owing to the coronavirus outbreak. A former Vietnamese government adviser claimed that the disease will cause Vietnam’s economic growth rate to drop by around one percentage point from its target, to around 5.9 per cent or 6 per cent. However, the Vietnamese government plans to stick to its target growth rate of 6.8 percent this year, showing confidence of its ability to fully and comprehensively contain the outbreak quickly.



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Vietnam is looking ahead for a tentative rebound of its coronavirus-hit economy as the caseload remained relatively low in recent days and drastic travel restrictions and lockdowns seem to work in curbing the spread of the disease. Currently, the country has 85 confirmed cases of coronavirus–infected people, of which 16 have fully recovered and have been discharged from hospital. The improving situation is seen as a result of Vietnamese officials reacting early to the virus by banning arrivals from China and ordering people suspected sick into quarantine instantly. The country was also quick in quitting the issuance of visas to...

Vietnam is looking ahead for a tentative rebound of its coronavirus-hit economy as the caseload remained relatively low in recent days and drastic travel restrictions and lockdowns seem to work in curbing the spread of the disease.

Currently, the country has 85 confirmed cases of coronavirus–infected people, of which 16 have fully recovered and have been discharged from hospital.

The improving situation is seen as a result of Vietnamese officials reacting early to the virus by banning arrivals from China and ordering people suspected sick into quarantine instantly.

The country was also quick in quitting the issuance of visas to almost all foreign nationals for 30 days, starting March 18. Ho Chi Minh City authorities are also curbing meetings geared for more than 1,000 people, while cinemas, bars and entertainment venues are closed through March 31.

Government incentives for businesses rolled out

To support the economy, the government has rolled out incentives to revive companies including export manufacturers, a backbone of the economy that has grown around six per cent per year since 2012. The Vietnam government is also offering tax breaks, extending tax due dates and allowing delayed land-use fee payments to companies affected by the outbreak.

Furthermore, the central bank cut its benchmark refinance rate to five per cent from six per cent and the discount rate to 3.5 per cent from four per cent, a measure to mitigate the impact of the outbreak on banks and corporate finances in order to helping to minimise disruption and save jobs.

Factories in Vietnam are still operating, and export growth from January 1 through March 15 was 6.8 per cent over the same period of 2019, a remarkable figure given the doom-and-gloom prophecies of many analysts.

Exports to the European Union expected to drop

On the downside, the European Union’s decision to close its borders amid the coronavirus pandemic could reduce Vietnam’s exports to the bloc by up to eight per cent, the country’s trade ministry said. Though the ban on entry does not apply to goods, the ministry expects safety measures in Vietnam’s second largest export market after the US to slow down trade and consumption. Cargo shipped by air would face challenges due to restrictions on flights, while demand for export items such as textiles, footwear, computers and smartphones would be lower.

However, the economic toll of the crisis on Vietnam remains visible. Apart from airlines that halted their flights to infected destinations, industries including tourism, transport, electronics, agriculture and insurance are bearing the bunt. Many restaurants, shops, cinemas and entertainment places are also severely affected due to lack of the demand.

Government keeps GDP growth target unchanged

The Asian Development Bank estimated that Vietnam would lose 0.41 per cent of GDP owing to the coronavirus outbreak. A former Vietnamese government adviser claimed that the disease will cause Vietnam’s economic growth rate to drop by around one percentage point from its target, to around 5.9 per cent or 6 per cent. However, the Vietnamese government plans to stick to its target growth rate of 6.8 percent this year, showing confidence of its ability to fully and comprehensively contain the outbreak quickly.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

$
Personal Info

Donation Total: $10.00

 

 

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