Efforts to recover economy strongly

Two months after Vietnam stepped out of the pandemic stage, the Government has stepped up the recovery and economic development activities in thenew normal along with the efforts of the business community. Thanks to that, the economy has initially had positive signs.

Strong messages

According to the head of the Government, the central task after pushing back the Covid-19 pandemic was boost production and business; promote growth with the spirit of early recovery and thedevelopment of socio-economic activities. The Government and the Prime Minister have continuously organized meetings and worked with businesses, localities and key economic regions to solve difficulties and obstacles in production, business and revenue attracting investment and promotinggrowth. At the same time, many mechanisms and policies issuedto "reduce pain",support and recover the economy such as Resolution No. 84 abouttasks and solutions to continue removing difficulties for production, promoting disbursement of public investment and ensuring social order and safety amidthe Covid-19 pandemic; Resolution No. 68 about the programme to reduce and simplify regulations related to business activities in the period of 2020 - 2025.

Specially, the Government has developed scenarios to revive the economy in 2020 as well as to study and consider the ability to adjust economic development targets. The main force for growth in 2020 was also requested by the Government heads of ministries, branches and localities to focus on deploying, the fiveconsecutive attacks of the Government emphasised: domestic private investment; attract foreign investment; push exports; promote public investment andencourage domestic consumption. Notably, the Government has sent strong messages for these five defences. Accordingly, the Prime Minister required disbursing 100% of public investment capital by 2020; disciplining the head of the organization if disbursement of public investment fails to achieve results. Immediately after loosening isolation, projects and works are being focused by investors and contractors to accelerate progress. Thus, the disbursement of public investment in 5 months, especially in May, has changed positively with the five-month disbursement rate reaching 26% of the plan.

In order forVietnam to havemany "eagles" after Covid-19, the Prime Minister decided to set up a special working group on attracting foreign investment. In the first fivemonths of the year, Vietnam attracted nearly US$14 billion, although it decreased by 17% compared to the same period last year but this is a remarkable figure in the context that the world's FDI tends to decrease due to Covid- 19.

Another good sign is the policy of supporting startups and facilitating business registration and newly established businesses have soared after social distancing. In May 2020, Vietnam had 10,700 newly established enterprises with registered capital of 112.7 trillion dong, an increase of 36% in the number of enterprises and up 20.1% in the registered capital. Along with that, the export situation also improved. Although in fivemonths, export turnover of goods decreased by 1.7%, but in May, it was estimated to reach $18.5 billion, up 5.2% compared to the very deep decline of April. Promoting the domestic market also helped trade and services increase sharply.

Need to improve the decision-making process

According to economist Ngo Tri Long, the fact Vietnam has controlled and prevented the pandemic from the beginning has created a motive foundation, creating favorable conditions to restart its economic recovery faster than other countries. “In the new situation when international economic integration is still very limited, Vietnam has promoted its internal strength to restore the economy. Social isolation has interrupted economic development, so what is achieved in economic development after the isolation order removed is remarkable,”said Ngo Tri Long.

According to PhD Le DuyBinh, Director of Economica Vietnam, theCovid-19 pandemic still has quite severe consequences for the global economy as well as Vietnam's economy and there are still many uncertain factors. Achievements in the current situationhave beenvery encouraging, both in terms of management as well as in terms of businesses and people. In particular, the most outstanding thing in recent years is the spirit of businesses and entrepreneurs of Vietnam very strongly. “The efforts of enterprises in recent times show businesses find ways to survive in a pandemic, which is very miraculous and very respectable. By all means they maintain their operations by their strengths, but there are also businesses willing to switch to new products to find new customers and accept different levels of risk in the process of production and business,"PhD. Le DuyBinh said.

Although recognizing positive results in economic recovery, many people think that this result is only the first step, there are many challenges ahead, along with the implementation of supporting policies for businesses, people according to the assessment is still slow. “The openness of the Vietnamese economy is enormous, while many predict it will take 12 months to control the Covid-19 pandemic. The challenges ahead are still huge, while the internal economy is still quite unstable, such as weak competitiveness, many business bottlenecks, thousands of businesses and millions of business households and people are struggling, soto overcome it will take a whole process. These challenges, if the support measures are not implemented in time, will cause huge consequences. Therefore, the administration of the Government must be more drastic and urgent. Some policies have been implemented quite slowly within recent times,”said Ngo Tri Long.

For business production and the economy to recover soon, rather than "escape death", PhD. Nguyen DinhCung, former Director of the Central Institute for Economic Management, suggested that, besides money support, improving the decision-making process is an urgent requirement to quickly overcome the overlapping, remove bottlenecks andpromote reform and innovation.

Regarding bottlenecks in economic development after the pandemic, the Central Institute for Economic Management (CIEM) continues to emphasize the bottlenecks on institutional quality, digital infrastructure bottlenecks, skills and labour productivity. These are bottlenecks that Vietnam needs remove to recover the economy faster.

Source: Customs News