Vietnam Q1 GDP Grows 4.5%, Driven By Rising Exports | Vietcetera
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Vietnam Q1 GDP Grows 4.5%, Driven By Rising Exports

Vietnam’s GSO recorded YoY GDP growth of 4.5% in Q1 and the economy is expected to grow even more strongly by 6.6%, reads a World Bank economic report.

Vietnam Q1 GDP Grows 4.5%, Driven By Rising Exports

Vietnam’s growing economy is driven by the expansion of the processing and manufacturing industries, which grew 9.5%. | Source: Shutterstock

The Vietnamese economy was one of the few economies in the world that didn’t contract last year amid the pandemic. And despite the new outbreak which emerged in January this year, the country continued to enjoy economic growth.

In fact, the country’s General Statistics Office recorded a year-on-year gross domestic product (GDP) growth of 4.48% in the first quarter of this year and the economy is expected to grow even stronger by the end of the year.

After more than a year of quarantines, closures, and general disruption, the growth of the nation’s GDP showed the drastic efforts of the government, localities, businesses, and people to reach the dual goal of both controlling the disease and developing the economy, said the GSO.

“Vietnam’s economy lost a little momentum in the first quarter due to a renewed virus outbreak, but with the latest wave quashed and most restrictions now lifted, the economy should bounce back strongly over the coming quarters,” Gareth Leather, senior Asia economist for Capital Economics, wrote in a research note.

Vietnam’s growing economy is driven by the expansion of the processing and manufacturing industries, which grew 9.5%. The construction industry also grew 5.17%.

Import-export turnover reached an estimated $152 billion in the first quarter, up 24 percent against the same period last year. Export in the first three months of 2021 also jumped to $77.34 billion, while imports increased to $75.31 billion, resulting in a trade surplus of $2.03 billion.

The industrial and construction sector in the January-March period grew 6.3% from a year earlier, the General Statistics Office said in a statement. The services sector rose 3.34% and the agricultural sector expanded 3.16%.

This was relatively decent growth in comparison with other regional and global economies.

Vietnam's stringent anti-coronavirus measures helped to rein in coronavirus infections, allowing it to resume economic activity earlier than many countries in Asia.

According to the most recent report on “Uneven Recovery in East Asia and the Pacific” released by the World Bank last week, Vietnam's economy is projected to grow strongly by about 6.6% in 2021, much higher than its peers in the region.

“Only China and Vietnam are experiencing a V-shaped rebound where output has already surpassed pre-pandemic levels,” reads the World Bank data.

World Bank’s analysis focused on vaccination, fiscal, and climate change policies, follows on two economic updates for the region in 2020 that looked at six other policy dimensions of a resilient recovery from the COVID-19 pandemic: smart containment, smart schooling, stepped-up social protection, support for firms, balanced financial sector policies, and trade reform.

By the looks of it and based on the data results, Vietnam is indeed getting back on track and is even ahead of the race.

Apart from the World Bank and Vietnam’s own government data, several other organizations also have optimistic views on the country’s growth in 2021 and beyond, as long as the country maintains its effective COVID-19 fight.

The Standard Chartered Bank expects Vietnam to grow at 7.8% this year, with manufacturing driving the revival. In the same way the Asian Development Bank has forecast 6.1% growth, the International Monetary Fund, 6.5%, and HSBC, 7.6%.