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Nikkei: Vietnam's economy will fully recover in 2021

29/12/2020

According to Nikkei - The Japan Times, Vietnam will lead the economic growth in the region next year.

Southeast Asia's 6 largest economies will see a big difference in growth in 2021 - of which, the economies of Vietnam, Indonesia and Malaysia will return to pre-pandemic levels, while the economies of Singapore, the Philippines and Thailand will continue to struggle, according to Nikkei Asian Review.

This Japanese newspaper gathers the forecast of the International Monetary Fund (IMF) on the real gross domestic product (GDP) of each country and sets the number for 2019 as the 100-point baseline. It draws the conclusion that the economies of Vietnam, Indonesia, and Malaysia all reach more than 100 points in 2021, meaning these economies will recover to the pre-pandemic level.

Even so, all of Southeast Asia's six largest economies will continue to face the challenges posed by the pandemic, as well as a new government coming to power in the United States.

Vietnam is forecast to be the leading economy in growth in the region next year, with the growth index as calculated above reaching 108.4 points. Recently, S&P Global forecasts that Vietnam's economy will expand by 10.9% in real terms in 2021, stronger than any other economy in the Asia-Pacific region, following an increase of 2.91% in 2020.

Vietnam is also the only country among Southeast Asia's six largest economies to log real economic growth this year, thanks to its quick success in curbing the coronavirus pandemic, Nikkei emphasized.

Indonesia is the economy with the second highest growth rate in 2021, reaching 104.5 points, according to Nikkei calculations. Malaysia has an economic growth index next year reaching 101.3 points. Meanwhile, Singapore, the Philippines and Thailand may not be able to reach 100 points by 2022.

Tourism, which accounts for about 20% of Thailand's GDP, is forecast to continue to struggle next year. Auto exports, a source of economic growth, are also unlikely to return to pre-pandemic levels in 2021.

For the Philippines, consumption is showing signs of exhaustion. Singapore's tourism industry is also expected to recover slowly.

Despite uneven growth forecasts for the coming year, all six economies could be affected by the global pandemic, as well as the policy of US President-elect Joe Biden - who will officially take power on January 20.

The Covid-19 vaccine has already started in a number of countries, but it may take a long time to become available in developing regions such as Southeast Asia. In addition, the efficacy of the vaccine against a new strain of Covid-19 recently discovered in the UK has not yet been verified.

 

Kylie Nguyen

© 2019 Vietnam Bank for Agriculture and Rural Development No. 2 Lang Ha street, Ba Dinh district, Hanoi, Vietnam
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