Friday, July 24, 2020

Can Vietnam leverage its COVID-19 success for economic growth?

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Inshiya Nalawala

Article Title

Can Vietnam leverage its COVID-19 success for economic growth?

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Global Views 360

Publication Date

July 24, 2020

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A policeman helping a rider fix their mask

A policeman helping a rider fix their mask | Source: Đài Truyền Thanh TPST via Wikimedia

While the entire world is battling with COVID-19, Vietnam, in a country of over 100 million recorded just 330 cases as of early June 2020 and zero death in May 2020.

A professor at Nagasaki University’s Institute of Tropical Medicine Vietnam Research Station said that "Vietnam has no special test kits or drugs to treat the disease, but the government decided to do what it had to do at an early stage and put that plan straight into practice."

Vietnam was quick in its action. As soon as the first case was confirmed, the government had called upon measures for serious quarantine, implemented strict border control measures, and curbed unnecessary local movement. Close to a million people were isolated to halt the spread of further infections.

The strict measures helped Vietnam to quickly control the COVID situation and put the focus back on the economy. The mainstay of Vietnam's economy, garment export and tourism witnessed steep fall resulting in loss of employment to over 3.5 million people in the first half of 2020. Still Vietnam’s economy has expanded by 0.36% over last year in the same period unlike other countries in the region where it contracted as compared to last year. The annual GDP growth for Vietnam in 2020 is expected to be around 2.7% to 3% which again is the best in the region.

Vietnam , today is the safest country in the region to travel, work, or stay amidst the worldwide COVID pandemic. It is being favourably considered as an alternative destination by many companies who are looking to cut down their reliance on China in their supply chain.  The Free Trade Agreement (FTA) between the European Union and Vietnam which will be operational in August, may help Vietnam grow its exports.

Apart from export led growth, the tourism sector may also grow significantly as the other major tourist destinations in the region, Singapore and Thailand, are still battling with the pandemic, while Vietnam has successfully overcome the same.

The government is also looking to support the local business by slashing the corporate income tax to 30 percent which increased the liquidity for some sectors of economy. Special tax benefits and deferred tax payments(in some cases) are also in  line for small and medium enterprises (SMEs) which constitutes almost 97% of all the businesses in Vietnam. All these measures are expected to lead to a 7% GDP growth for Vietnam in 2021.

The miraculous recovery from the pandemic, government incentives to industry, and the willingness of many companies to relocate from China present such a perfect mix of opportunities for Vietnam to leap ahead and become the fastest-growing economies in SouthAsia. What remains is to see how fast and how effectively the country is able to act while this window of opportunity is open.

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February 4, 2021 4:45 PM

How the failure of political leadership resulted in the explosion of pandemic in Brazil

With over 1.2 million active cases and over 51 thousand deaths as on 30th June 2020, Brazil is one of the worst coronavirus affected countries. Latin America became the epicentre of the coronavirus pandemic in the latter half of May, largely due to Brazil’s incompetency in dealing with the pandemic. Due to the underreporting and low testing rates, the actual number of active cases and deaths are unknown.

The Brazilian Ministry started making changes to the number of cases reported, making it even harder to control the situation the pandemic has caused. The country’s response has been widely criticized in Brazil and outside. The President of Brazil, Jair Bolsonaro, dismissed the threat of the virus and the pandemic. OnMarch 26, 2020, he said that Brazilians are immune to the virus and even if they are drunk in a sewer they “don’t catch a thing.” He defied the guidelines set by his own health ministry and visited a busy commercial district in Brasilia, the capital of Brazil, where he told all the elderly Brazilians to get back to work. He also went on TV many times and called it little flu and accused the media of hysteria. Even as the coronavirus crisis has worsened recently, some major cities have eased their preventive measures, like Sao Paulo opening up shopping malls in Mid-June and beaches getting crowded again. With all of this happening, hospitals are close to running out of intensive care beds.

In early March, Brazil declared a public health emergency, a few days after the World Health Organization. The Ministry of Health in Brazil urged the officials to cancel all the public events and reinforce the measures of social distancing as prescribed by the World Health Organization. Some experts thought that Brazil could handle the pandemic based on its records during past public health emergencies. Brazil’s health care system is underfunded, but it does not fail to provide robust coverage across the country. The efforts of the state government went awry when the President called the virus a “cold” and provided anti-malaria tablets as a solution to the virus. President Bolsonaro’s clash with the governors and officials led to two health ministers leaving- one was fired and the other one quit. This left the military general, with no public health training, in charge of the virus. The clash amongst the government left the citizens of Brazil uncertain about the importance of following the preventive measures kept in place to prevent the spread of the virus. This led to the defying of the measures, which in turn led to the pandemic’s rate being one of the highest in the world.

The Ministry of Health has not presented a comprehensive plan to beat the virus yet. One of the main initiatives by the Ministry of Health is to boost the production of hydroxychloroquine and has encouraged the doctors in the public healthcare system to prescribe the same. The country has struggled to import lifesaving instruments, like coronavirus tests and ventilators. The lack of tests, in turn, has made it difficult to track the spread of the virus. This might result in the undercount of cases of the virus in the country.  Between Jan. 1 and June 6, 23,171 people who were not diagnosed with the coronavirus died from acute respiratory infections, according to data released by Fiocruz, one of Brazil’s state-run health research institutes. Experts believe most of them died from coronavirus.

At a time when Brazil needs to be putting all its efforts into fighting the virus, the president has been wrapped up in his own political battles. The Supreme Court is investigating allegations of disinformation and intimidation by the President’s supporters. Investigations also state that he has interfered in federal police investigations to protect his family. Due to this, the tensions between President Bolsonaro and the judiciary are high.

During the past few months, politics have become bigger than the pandemic. Even though the health crisis is extremely important, the magnitude of the political scandals has had a huge impact on how the country reacts to the pandemic. There is anger over how President Bolsonaro is handling the crisis and at the same time, there is a fear as to where the country is headed after the pandemic passes.

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