The disease situation in the world has not tended to decline, the economy needs a new step to compensate for the loss of tourism – services, including strengthening production and investing in infrastructure.
The heavy decline in tourism and service opens a new direction
Outbroke in December 2019 in Wuhan (China), COVID-19 has spread to the world at a terrible speed. As of January 26, 2020, nearly 100 million people were infected with COVID-19, with more than 2.1 million people dying from the epidemic.
Spreading of disease has profoundly affected the global economy in general and Vietnam in particular, includingTrade – Services. Accordingly, in the second quarter of 2020, Vietnam’s economy increased by 0.36% over the same period last year, the lowest in the same period between 2011 and 2020. In which, the service sector was the most affected by the disease, with growth of -1.76%. Total merchandise import and export turnover in 2020 is estimated to increase by 5.1% over the same period last year. Vietnam has an estimated trade surplus of 19.1 billion USD – the highest level since 2016.
Energy, Logistics are standing out in attracting investment
HOUSELINK data shows that energy contributes approximately half of the total investment value of industrial construction projects with total capital greater than $ 2 million initiated in 2020. Logistics centers, electronics factories and processing wastewater treatment are respectively ranked after the energy sector in terms of investment value. The total investment value of these four types of projects accounts for 71% of the total project value.
Energy is also a field with a record increase in investment value in 2020 compared to 2019, mainly due to large-scale gas power projects. The logistics and wastewater treatment warehouse sector witnessed spectacular growth, with investment value increasing 8.2 and 28.3 times respectively compared to 2019.
Consolidation of Production is a top priority in the current context
With the Vietnam – European Union Trade Agreement (EVFTA) taking effect from August 1, 2020, Vietnam is currently one of the only two Asian countries that has signed a Free Trade Agreement with European Union.
Vietnam and 15 trading partners have signed the Regional Comprehensive Economic Partnership (RCEP). RCEP is a trade agreement between ASEAN and 5 partners that already have an FTA with ASEAN; including: China, Korea, Japan, Australia, New Zealand. The agreement is expected to create the largest free trade area in the world – a market of 2.2 billion people, worth $ 26,200 billion.
These Agreements opened up opportunities for high-quality exports but also presented many challenges. Consolidation of Production and localization increase for Vietnamese products is the top priority of Vietnamese enterprises at this time.
Good disease control in 2020 and current factors are creating a huge momentum for Vietnam’s economy and industry to make a breakthrough in 2021. Read the summary report posted here for more information.
Sign up HERE to receive Detailed Reports.