In the second-quarter of 2020, Vietnam’s GDP grew at the slowest rate in several years due to the negative impact of the Covid-19 panemic. GDP in April-June increased 0.36% y-o-y, compared with an economic growth of 6.73% in the similar period last year, as per government’s General Statistics Office.
It was the slowest GDP growth rate since the series began to be published in 2000. The decline was driven by Covid-19 outbreak and overall weak worldwide demand. In the first half of 2020, the economy grew 1.91% on y-o-y basis.
Regarding the impact of Covid-19, the General Statistics Office (GSO) of Vietnam issued the following statement:
“The complicated development of the COVID-19 pandemic has left a negative impact on all socio-economic aspects.”
The GSO also revealed that services sector contracted 1.76% y-o-y in 2Q20, while the industrial sector grew 1.38% and the agricultural industry expanded 1.72%.
The Southeast Asian nation intends to restart economic activity after registering only 355 Covid-19 cases and zero deaths due to coronavirus infection. The country also avoided social spreading for over two months.
The IMF (International Monetary Fund) has predicted last month that Vietnam’s GDP will decrease to 2.7% this year, but Prime Minister Nguyen Xuan Phuc stated that his government will aim to maintain a GDP growth above 5%.
As per GSO, Vietnam’s exports in the initial half of this year declined 1.1% y-o-y to $121.21 billion, while imports have decreased 3% to $117.17 billion, leading to a trade surplus of $4.04 billion. The country’s consumer prices increased 3.17% y-o-y in June. Average consumer prices in the January-June period increased 4.19%.
In Vietnam, retail sales rose by 5.3% y-o-y in June, following a 4.8% decline in May. It was the first growth recorded in retail trade since February, as demand, mainly for general goods (9.4% in June versus 1.6% in May) increased due to government initiatives to limit the spread of Covid-19.
During the same period, slowdown was not sharp in sectors such as accommodation, foods & beverages (narrowed to -8.3% from -33.8%), travel (-50.7% compared with -87.8%), and other services (-2.1% against -9.8%). Taking into account the January-June period, retail sales fell 0.8% from the comparable period of 2019.
Notably, the GSO also stated that Vietnam’s industrial output in June increased 7.0%y-o-y.
