Vietnam is amongst the “brightest” spots in Asia regardless of the problem of making an attempt to comprise the coronavirus pandemic — and its economic system is poised to rebound, a UBS economist mentioned this week.
“Vietnam is suffering some pain from the impact of Covid-19, but the outlook is looking one of the brightest in the region,” mentioned Edward Teather, Asean economist at UBS Research.
“Retail sales, imports (and) industrial production were all actually up on the year in the month of June, which is better than you can say for most economies in the region,” he informed CNBC’s “Squawk Box Asia” on Monday.
Many economies contracted in the second quarter of 2020 in comparison with a 12 months in the past, however Vietnam’s gross home product grew barely at an estimated 0.36%.
A girl leaves a cosmetics retailer in Hanoi, Vietnam on July 6, 2020.
Nhac Nguyen | AFP | Getty Images
The nation was successful in containing its coronavirus state of affairs regardless that it shares a border with China, the place the virus outbreak was first reported.
Vietnam has reported 369 instances and no deaths to date, in keeping with information compiled by Johns Hopkins University. The nation has for a inhabitants of underneath 100 million.
“Vietnam is growing and is well-positioned to continue to take global market share in terms of exports going forward, so pretty bright prospects in a relative sense in the region,” Teather mentioned.
The nation is seen instead manufacturing hub for firms that need to shift manufacturing out of China because of tensions between Beijing and Washington which have resulted in rising tariffs.
Boost to the economic system
Overall FDI ranges are prone to be hindered, in half as a result of traders can’t journey freely, he predicted. However, there is “plenty of activity” in the pipeline, and people investments may decide up in 2021 as border restrictions are eased.
Government help can also enhance Vietnam’s economic system, he mentioned. “The prime minister just over the weekend was calling for more measures to support the economy, and the central bank was actually saying they want to get credit growth up over 10%.”
“It does look as if the authorities, having got some momentum are pushing further,” he added.