ADB revises down growth outlook for Vietnam

Making garment products for export (Photo: VNA)

The Asian Development Bank (ADB) has lowered its forecast of Vietnam’s gross domestic product (GDP) growth in 2021 to 5.8 percent from its previous prediction of 6.7 percent in April, as the fourth wave of COVID-19 infections hampers the country's recovery.

Vietnam's economic growth accelerated from 1.8 percent in the first half of 2020 to 5.6 percent in the same period this year as the global recovery from the pandemic boosted export, the bank said in a report released on July 20.

However, the ongoing wave of COVID-19 infections has led to disruption in supply chains and prolonged social distancing measures in many provinces and cities whose growth rates are high. These have severely affected the circulation of goods and greatly limited economic activities in 2021.

Also as part of the report, the bank is projecting 7.2 percent economic growth for developing Asia in 2021, compared with its forecast of 7.3 percent in April, as new COVID-19 outbreaks slow the recovery in some regional economies.

Excluding the newly industrialised economies of Hong Kong (China); the Republic of Korea; Singapore; and Taiwan (China), developing Asia’s updated growth outlook is 7.5 percent for 2021 and 5.7 percent for 2022, compared with earlier projections of 7.7 percent and 5.6 percent, respectively.

“Asia and the Pacific’s recovery from the COVID-19 pandemic continues, although the path remains precarious amid renewed outbreaks, new virus variants, and an uneven vaccine rollout,” said ADB Chief Economist Yasuyuki Sawada.

“On top of containment and vaccination measures, phased and strategic rejuvenation of economic activities - for instance, trade, manufacturing, and tourism - will be key to ensure that the recovery is green, inclusive, and resilient.”

The COVID-19 pandemic remains the biggest risk to the region's outlook, as outbreaks continue in many economies./.