Vietnam’s growth to surpass 6% in 2022, 2023: OECD

At the OECD-Vietnam High-Level Economic Forum held Tuesday, Mathias Cormann, Secretary-General of OECD, said Vietnam was one of the few countries in the world that managed to escape from Covid-related recessions.

In the two years of the pandemic (2020-2021), Vietnam’s economy still grew by 2.91% and 2.58%, respectively. In the first half of this year, Vietnam has been seen to recover more quickly than expected thanks to its manufacturing and service industries, Cormann said.

Vietnam has also demonstrated its resilience against outside impacts, like inflation, Cormann added.

“Global inflation is on the rise due to the increase of food and energy prices, but Vietnam is keeping them under control. Vietnam’s inflation rate is also lower than OECD countries,” he noted.

Andrew Jefferies, Vietnam Country Director of the Asian Development Bank, cautioned that there were industries in Vietnam still in the recovering phase.

“Global inflation demands economies to pay more attention to sustainable recovery,” he said.

Vietnam needs to know exactly where to target its fiscal and monetary policies while continuing with tax relief and tax exemption policies and helping businesses gain access to loans. Vietnam also needs to bolster its social security policies and support for informal workers, among other measures.

“Short-term fiscal mechanisms would help the economy recover amidst rising inflation,” he said.

Cormann said Vietnam’s capability for growth was quite strong. It was expected to surpass 6% in 2022 and 2023 thanks to FDI inflows as global businesses seek out Vietnam to diversify their supply chains. Vietnam would also stand to gain from opening up commerce, thus increasing connectivity and knowledge transfer, he added.

At this time, Vietnam needs to push further for reforms and ensure sustainable growth. It also needs to respond to a quickly aging population by increasing productivity, the OECD advised.