|Nguyen Thu Huong, Deputy Director-General of the General Statistics Office of Vietnam, speaks at a press briefing about the country’s socio-economic performance for the first half of 2020, held in Hanoi on June 29 – PHOTO: GSO|
HCMC – Vietnam’s economic growth in the first half of 2020 fell to its slowest pace of 1.81% in a decade, versus a 6.73% expansion during the same period last year caused by fallout from the coronavirus pandemic.
The General Statistics Office of Vietnam (GSO) held a press briefing in Hanoi on Monday to release its report on the country’s socio-economic performance for the six-month period.
The economy grew a mere 0.36% in the April-June period, compared with a 6.73% increase during the same period last year. It was also the smallest expansion in the second quarter during the 2011-2020 period.
This was attributable to the fact that the economy was hit hard by the Covid-19 pandemic in the second quarter as the Government ramped up social distancing measures, according to the GSO.
The agency reported that the agriculture, forestry and fisheries sector recorded a growth rate of 1.19% and contributed 11.89% to the overall economic growth during the six-month period. The respective figures for industry-construction are 2.98% and 73.14%; and 0.57% and 14.97% for the services sector.
The main drivers behind the economic growth in six months, according to the GSO, were the manufacturing and processing industry which expanded 4.96%; and market services, such as wholesale and retail (4.3%) and financial, banking and insurance activities (6.78%).
“The complicated development of the Covid-19 pandemic has left a negative impact on all socio-economic aspects,” noted Nguyen Thu Huong, Deputy Director-General of GSO.
Huong noted that the Government has given priority to epidemic prevention and control to safeguard public heath at the expense of economic benefits.
“This is a solid base for our economy to sustain its growth instead of falling into negative growth [like other countries],” she said.
The GSO said that Vietnam has brought the Covid-19 pandemic under control. However, the crisis still has a direct impact on trade, tourism, transport and import-export in other parts of the world.
Businesses are facing a shortage of raw materials, resulting in a reduction in their production scale or even operational suspension, said the GSO.
The agency added that the pressure to control inflation and rising unemployment and underemployment would affect social security. Therefore, a proactive approach is needed to stem a second wave of Covid-19.
The country’s headline consumer price index in the first half of this year rose by 4.19% year-on-year, the highest first-half increase recorded since 2016.
Vietnam is seeking to resume its economic activity after recording only 355 Covid-19 cases and no virus-related deaths. The country has not seen any community infections for more than two months.
The International Monetary Fund forecast last month that Vietnam’s economic growth would slow down to 2.7% in 2020.
Meanwhile, the Asian Development Bank predicted Vietnam would grow 4.1% this year, as containment measures to address the coronavirus pandemic hamper economic activity and weaken external demand.
Speaking at a conference in May, Prime Minister Nguyen Xuan Phuc said Vietnam is expecting a dramatic economic recovery following the coronavirus pandemic, with the GDP growth forecast at 5%.
Measures to boost economy
The GSO urged the Government to undertake major measures to rev up the economy, including cutting the red tape for enterprises to have easier access to supporting policies from the Government.
The GSO also suggested the Government speed up the disbursement of public investments and tackle difficulties in key, large-scale projects, which have seen slower-than-expected progress toward disbursement.
The move is intended to implement strategies for infrastructure and improve production capacity.
Also, measures need to be taken to prevent new outbreaks of African swine fever, a contagious viral disease impacting only pigs.
The GSO suggested the Government encourage pig-breeding firms to raise the number of pigs in order to meet the domestic demand of pork and reduce their prices to control inflation.
The Government should also stimulate investment in firms, which produce goods for export to help them prepare their products, as other countries will soon reopen their markets.
They are expected to enjoy benefits from the free trade agreement between Vietnam and the European Union, which is set to take effect in August this year.
Ministry warns about online lending apps
HÀ NỘI — The Ministry of Public Security has warned about the risk of black credit provided by online lending applications which could threaten social security.
Online lending apps provide trust-based loans in which the borrowers do not need mortgage assets. Transactions were conducted online via websites, online exchanges and apps installed on smartphones.
The borrowing and lending process through the apps was very easy, as people who want to borrow money only have to complete some simple registration procedures including downloading the app, filling in personal information including an account number to receive money, uploading a photo and identity cards, and allowing the app to access their personal contacts.
However, the ministry warned that many lending apps turned out to be a form of black credit with cut-throat interest rates, which might have unintended consequences and affect social security.
The ministry urged borrowers to study online lending providers together with contract terms carefully to avoid risks.
Việt Nam was developing a sandbox for financial technologies, including peer-to-peer (P2P) lending, which was critical to ensure fintech development remains on track.
There are around 40 companies providing P2P lending services in the country. —
Sóc Trăng exports jump 26% despite pandemic
MEKONG DELTA — The Cửu Long (Mekong) Delta province of Sóc Trăng’s exports in the first six months of the year increased by 26 per cent year-on-year to US$470 million.
Seafood accounted for $332 million, a 24.8 per cent increase, and rice for $97 million, 2.2 times higher.
Võ Văn Chiêu, director of the provincial Department of Industry and Trade, said seafood exports had been sustained despite the difficulties caused by the COVID-19 pandemic thanks to efforts to control it.
Võ Văn Phục, director of the Việt Nam Clean Fishery JSC, one of the biggest exporters in the province, said shrimp exports would increase by 50 per cent in July from the same period last year thanks to Việt Nam controlling the disease outbreak.
Businesses in Sóc Trăng have methodically invested, branded and built value chains, and so the province’s exports increased even when the export markets were plagued by difficulties.
The province has set this year’s export target of $900 million, $670 million from seafood.
To meet it, it encourages firms to expand markets, improve design and quality, and diversify products to meet various consumer demands. —
Hà Nội condominium market has recovery of sales in Q2
HÀ NỘI — The new launch of condominiums in the second quarter of this year (Q2) nearly tripled that of the previous quarter, showing recovery of sales activities, according to CBRE Việt Nam’s quarterly report on the Hà Nội market released on Tuesday at an online press conference.
In terms of segments, 88 per cent of units launched in Q2 were in the mid-end segment while the remainder were high-end products.
Sales momentum was relatively positive in Q2 compared to the previous quarter, with more than 50 per cent of units launched during the quarter having been absorbed.
In Q2, there were a total of 5,100 sold units, more than double that of the previous quarter. The sales picked up in Q2 thanks to the social distancing order removed.
Diversification in sales channels such as online channels combined with direct marketing via sales events has boosted sales during the quarter, according to CBRE.
Especially, applications in project management and online sales have been successfully developed by many companies. Those technology platforms help to introduce projects, deal with customers and carry out online sales process.
In addition, investors and property trading floors can also receive sales data and information analysis to build suitable sales and marketing strategy, Robert Vũ, CEO of batdongsan.com.vn, a popular property website in Việt Nam, said on Wednesday at a press conference releasing a report on the domestic property market in Q2.
Local buyers are the key focus of developers during the first half of the year as foreign sales have been disrupted due to the suspension of international flights.
The segment of property for foreigners buying or renting significantly slowed down due to the reduced number of foreigners travelling in Việt Nam and a significant amount of foreigners going home due to the COVID-19 pandemic, Nguyễn Hoài An, director of Hanoi Branch, CBRE Vietnam told Việt Nam News.
“However, in the Hà Nội market, there were many experts of foreign companies coming back to work in Việt Nam by charter flights. Therefore, the experts must rent serviced apartments and hotels, leading to occupancy rates in many serviced apartment projects increasing from the end of the second quarter.”
The hotel segment in Hà Nội was in a better situation, although it still struggles, she said.
“The prospects of this property market for foreign customers would depend on the ability to re-open international flights and borders between Việt Nam and other countries,” An said.
The CBRE also reported that the Hà Nội market had about 5,600 units launched in Q2, leading to a total new launch during the first half of around 7,200 units – down 65 per cent year on year (y-o-y).
The new supply in the first six months declined significantly compared to the same period of last year due to COVID-19 disruption, said CBRE Việt Nam.
Selling prices in the primary market in Q2 averaged US$1,379 per sq.m (net of VAT), up by 3 per cent y-o-y. While mid-end products from township developments see higher selling prices due to an increasing amount of amenities, landscape and infrastructure, this segment witnessed the highest y-o-y growth of 4 per cent among segments.
The level of new supply is expected to stay at around 18,000-20,000 units in 2020, lower than 30,000 units at annual average for many years, according to the CBRE.
Nguyễn Hoài An, director of Hanoi Branch, CBRE Vietnam said that: “The lower level of new supply this year allows sales to catch up quicker with the new launch which had remained at a high-level over the past five years.”
This year, total sold units might be lowered to around 15,000-17,000 units in Hà Nội due to modest sales performance in the first half of this year.
The primary pricing is forecast to remain flat in the second half of this year since new supply is heavily dominated by mid-end segment and higher competition in this segment making it harder to escalate selling prices.
According to batdongsan.com.vn, the number of searches for mini apartments (with an area of less than 45sq.m) at the end of Q2 increased by more than 200 per cent compared to February 2020.
This reflects the growing trend of more young people and families wishing to own affordable apartments. This is also a reason for investors to build studio apartments and mini apartments, according to this website. —
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