On April 16, 2021, the US Treasury issued its report on “Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States” (the Report), which reviews the four quarters to December 2020. The Report finds that Vietnam (together with Switzerland and Taiwan) met all three criteria in 2020 under the Trade Facilitation and Trade Enforcement Act of 2015 (the 2015 Act), including:
Vietnam achieved 4.48% GDP growth in Q1 2021 despite the re-emergence of COVID-19 community spread. The re-emergence of COVID-19 community spread in late January slowed the economy’s growth; however, Vietnam still achieved GDP growth of 4.48% YoY in Q1 2021 (vs 3.68% YoY in Q1 2020), according to the General Statistics Office of Vietnam (GSO). Growth of all three main sectors of the economy improved compared to the same period last year, including agriculture/forestry/fishery (+3.16% YoY in Q1
Community spread contained; first shipment of COVID-19 vaccines arrived in Vietnam. At the beginning of March, the hotspot of Hai Duong Province announced it controlled the spread of COVID-19 and removed social distancing measures. In addition, 117,600 doses of AstraZeneca’s COVID-19 vaccine arrived Ho Chi Minh City on February 24. The Minister of the Ministry of Health (MoH) also announced that Vietnam will potentially have around 150 million doses of COVID-19 vaccines in 2021, which could cove
Community spread of COVID-19 re-emerged; Vietnam targets to control spread in 10 days. Strict measures, including lockdowns and social distancing, have been implemented in several areas in Quang Ninh, Hai Duong, Hanoi and other provinces. The Deputy Prime Minister announced that authorities will make every effort to contain community infections within 10 days (vs 23 days in Da Nang in August 2020). Given Vietnam’s previous success, we believe the country will once again quickly contain
Vietnam’s swift and uncompromising response to control the COVID-19 pandemic was rewarded not only by very low casualties relative to much of the rest of the world but also the ability to reopen much of the economy sooner and with more limited stress on macroeconomic and financial stability. As a result, Vietnam has reported a preliminary GDP growth figure of 2.9% for 2020 and is one of only a handful of countries expected to have seen an increase in GDP in 2020.
On December 29, 2020, the USTR convened a virtual Public Hearing on the Section 301 Investigation into Vietnam’s Acts, Policies, and Practices related to Currency Valuation. Twenty-one people testified at the hearing, including 19 people representing US and International Business/Trade Associations/Councils, US Chambers of Commerce and US businesses; one Emeritus Professor of Harvard University; and only one Vietnamese, representing the Research Institute of the Bank of Investment
On December 16, 2020, the US Treasury issued its long-delayed report on “Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States.” In the report, which reviews the four quarters to June 2020, the US Treasury labels Vietnam and Switzerland as currency manipulators under the Omnibus Trade and Competitiveness Act of 1988 as Vietnam met three quantitative criteria set by the US Treasury under the Trade Facilitation and Trade Enforcement Act of 2015 (the 2015 Act),
Community spread of COVID-19 emerges after nearly three months. Four cases of COVID-19 community spread were reported at the end of November in Ho Chi Minh City. However, unlike the reemergence of COVID-19 in Da Nang at the end of July, the source of the spread was quickly found this time. Overall, Vietnam has proven its ability to contain the pandemic and we believe the Government could handle another occurrence of COVID-19.
Production continued to experience robust recovery. The overall Index of Industrial Production (IIP) continued to maintain solid growth in October, rising 5.4% YoY. The manufacturing subsector was the key driver as its IIP surged 8.3% YoY, accelerating from 4.6% growth in September. According to IHS Markit, the Vietnam Manufacturing Purchasing Manager Index (PMI) inched down to 51.8 in October from 52.2 in September. The reading has been above 50 for two consecutive months, which implies
9M 2020 recap: Record high trade surplus despite COVID-19. In 9M 2020, Vietnam recorded exports of USD202.6bn (+4.1% YoY) and imports of USD186.1bn (-0.7% YoY), resulting in a record high trade surplus of USD16.5bn vs only USD7.3bn in 9M 2019. Contractions in global demand caused by the COVID-19 pandemic dampened Vietnam’s exports of key products, including phones & spare parts (-7.1% YoY in 9M 2020), textiles, garments & footwear (-10.5% YoY) and food & agriculture products (-2.2% YoY).