Vietnam is one of Thailand’s neighbors which has been successful in adapting and fighting the pandemic since the first stage during early 2020 until now. Only 328 were infected in Vietnam with no death (information of June 4th, 2020). It is one of the few nations that are able to control the disease.

The pandemic strongly affects many countries whose economic growths are expected to be low to negative during this year including China and the US. However, Vietnam’s first-quarter GDP grew 3.82% more compared to the same time last year. It is one of a few nations in which even COVID-19 negatively impacts the economy, however, the GDP is still positive (though it is the least in 10 years).

The most affected sector in Vietnam is the local agricultural sector as their main customers are China whose borders have been closed since the early pandemic. Fruits that used to be tremendously exported such as dragon fruit, durian, watermelon are oversupplied and underpriced. It was solved by promoting domestic consumption. Many business and restaurant owners creatively process those fruits, for example, ABC Bakery bakes the bread with the ingredient of dragon fruit and watermelon, Duy Anh Foods launched watermelon glass noodle and roll dough, and meatball from dragon fruit, Lavifood makes dragon fruit juice, KFC introduces pink bread from dragon fruit. These products are not only consumed domestically but also full of creativity and can be sold internationally at a 30-40% higher than their original price.

Moreover, we have seen the adaptation of retailers, restaurants, and fine diners as they are increasing their online sales. Online shopping platforms such as Lazada and Shopee also add more products and food from convenient stores and supermarkets to promote customer’s convenience during the lockdown. Delivery was made through delivery service including, Now.Vn, Grab, Lalamove, Baemin, and Soviet which promotes the sale by 30% during the first quarter of the year.

Importantly, the government issues the relief procedure for their people who are affected by the COVID-19. There is plenty of help including money to subsidize individually or as a household. Extending the tax-paying and rental deadline by 5 months from June 8th for businesses. The Bank of Vietnam has decreased the interest rate to a minimum of 2%. The Ministry of Industry and Trade decreased 10% of electric bills for 3 months (April - June 2020).

After the economic disaster overcome, the government plans to revive the economy by stimulating, encouraging, and supporting the business sectors. It has been proposed that all fees shall be reduced for the airline businesses. The tourism promotion plans have been prepared. Many measures have been issued to ensure their food security. Food and agricultural processing abilities were improved. The disease control has been strictly implemented in the slaughterhouse. To stabilize the pork price in the market, more pork has been imported to increase the production capacity. The Ministry of Finance reduced the step of work and the fees to reduce the operating cost of the business owners. Furthermore, the government has monitored the report with the related organizations to help the business runs smoothly. The utilization of the investment budget has been expedited, especially the residue from 2019 and the planned budget for 2020 to stimulate the economy.

It can be seen that besides the Vietnam government, the private sector also plays a major role in fighting the pandemic and not letting the affected one fight alone. This reflects their unity as they can survive the situation by creating new products. These together drive the nation’s economy to overcome the disaster. Vietnam will become a strong country with all the factors suitable for investment as the Vietnamese are the fighters who can handle the problems well.

For anyone who interested in conducting business in CLMV or the Great Mekong Subregion: GMS which are Cambodia, Lao, Myanmar, and Vietnam, SCB has international branches and is ready to support. For more information please contact: https://www.scb.co.th/en/corporate-banking/international-network.html

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Thanks for Siam Commercial Bank PCL. Ho Chi Minh City Branch, Vietnam: 
 

Reference:

1. DITP. “รายงานสถานการณ์เศรษฐกิจการค้าระหว่างประเทศ สาธารณรัฐสังคมนิยมเวียดนาม ประจำเดือนมีนาคม 2563.” (12/5/2020)

2.สถานกงสุลใหญ่ ณ นครโฮจิมินห์. “ต้องรอด! การปรับตัวของ SMEs เวียดนามท่ามกลางการแพร่ระบาดของ Covid-19.”  (12/5/2020)

3.DITP. “มาตรการเยียวยาผลกระทบจากไวรัส COVID-19 ต่อเศรษฐกิจของเวียดนาม.”(12/5/2020)