Economic expansion depends on speed of COVID-19 vaccination, to scale: Experts | Business

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COVID-19 vaccination (Photo: VNA)

Hanoi (VNA)Vietnam’s economic outlook greatly depend on COVID-19 vaccination speed and scale, the effectiveness of pandemic prevention and control measures and the effectiveness of support programs, experts held at a conference hosted by the Vietnam Center for Economic Strategy Studies (VESS) on October 18.

They claimed bad debts could continue to rise, becoming a threat to the financial system in the post-pandemic period. Therefore, they stress the need to prepare for worst case scenarios.

Dr Nguyen Duc Thanh, director of VESS, said the slow pace of vaccination has slowed Vietnam’s recovery process in 2021, which may cause it to lose its comparative advantage. Currently, Vietnam’s immunization coverage remains low compared to the global level, he noted.

The resurgence of COVID-19 has disrupted supply chains and affected the labor market, posing serious impacts on domestic businesses, he said, adding that growth in the first nine months of this year will not did not reflect the difficulties of the economy, especially the informal sector. .

Assoc. Professor Dr Pham The Anh, chief economist at VESS, said that due to the pandemic demand was low and transporting goods was difficult. However, the risk of inflation is high.

He explained that companies bear the increases in inputs, from oil prices to anti-pandemic costs, which will sooner or later be included in product prices. Therefore, when social activities resume and demand increases, rising costs will lead to inflation.

According to Thanh, in an optimistic scenario, when the pandemic prevention and control measures are effective and production resumes from the fourth quarter and vaccination is extended the rest of the year, GDP growth could reach about 1.8%.

However, in a less optimistic scenario when COVID-19[female[feminine returns to some localities, making it difficult to transport goods, as orders continue to leave Vietnam, the production chain is broken, there is a shortage of labor and input costs are rising, growth of GDP might only rise to 0.2%, Thanh said.

Thanh felt that to ensure economic expansion as planned in the optimistic scenario, it is necessary to speed up the vaccination process and expand its scale to all localities, and tackle the difficulties of transporting goods.

Thanh asserted that monetary policies should be designed to meet the economy’s demand for credit as well as risk management measures./.

VNA

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