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Vietnam’s 7-month economic overview (July 2020)

Thursday 30, 07 2020
Vietnam’s 7-month economic overview (July 2020)

Covid 19
Agriculture
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1. Industrial production

Industrial production has been facing difficulties and instability due to the Covid-19 epidemic, which has led to disruptions in the supply chain of raw materials for production.

In July, Index of Industrial Production (IIP) was estimated to increase by 3.6% over the previous month and by 1.1% over the same period last year, of which the mining industry decreased by 7.9%; processing and manufacturing industry increased by 2.1%; electricity production and distribution increased by 2.7%; water supply and waste treatment increased by 4.5%.

For the first 7 months of 2020, IIP is estimated to increase by 2.6% over the same period last year, much lower than the 9.4% increase in the same period in 2019. In particular, the manufacturing and processing industry increased by 4,2%, contributing 3.5 percentage points to the overall growth; electricity production and distribution increased by 2.1%, contributing 0.2 percentage points; water supply, waste management and treatment, increased by 3.3%, contributing 0.1 percentage points; mining industry decreased by 7.8%, contributing -1.2 percentage points.

Industrial

2. Business registration 

In July 2020, there were 13.2 thousand newly established enterprises with a total registered capital of VND 239.3 trillion and a registered labor of 91.4 thousand workers, which is a decrease of 3.8% in the number of enterprises, an increase of 72% in registered capital and a decrease of 8.7% in the number of employees compared to the previous month. The average registered capital of a newly established enterprise is VND 18.1 billion, an increase of 78.8% over the previous month and 60.9% over the same period in 2019. 

Generally, in the first 7 months of 2020, there were 75.2 thousand newly registered enterprises with a total registered capital of VND 936.4 trillion and a total registered labor of 598.6 thousand laborers, a decrease of 5, 1% in the number of enterprises, 6.3% in registered capital and 19.5% in the number of employees compared to the same period last year. The average registered capital of a newly established enterprise is VND 12.4 billion dong, decreasing by 1.2% over the same period last year. 

Business

3. Investment

In the context of the Covid-19 epidemic being well controlled in Vietnam, construction investment activities in provinces and centrally-run cities have basically returned to normal. The growth rate of realized investment capital from the state budget in July and 7 months of 2020 reached the highest level in the period 2016-2020.

Realized investment capital from the state budget in July 2020 was estimated at VND 45.7 trillion, up 51.8% over the same period last year. Generally, in the first 7 months of 2020, realized investment capital from the state budget reached VND 203 trillion, equaling to 42.7% of the year plan and 27.2% higher than that in the same period last year.

As of July 20, 2020, total foreign investment capital into Vietnam including newly registered capital, adjusted registered capital, and capital contribution and share purchase of foreign investors reached USD18.8 billion, a 6.9% decrease compared to the same period last year. 

Investment

4. Retail sales of consumer goods and services

Trade and service activities continued to increase thanks to policies that stimulate consumption and domestic tourism.

Total retail sales of goods and services in July were estimated at VND 431.9 trillion, an increase of 3.3% over the previous month and 4.3% over the same period last year, of which: retail sales of goods reached VND 333.8 trillion, that of accommodation and food services reached VND 48.2 trillion, of tourism reached VND 1.5 trillion, and of other service reached VND 48.4 trillion.

Overall, in the first 7 months of 2020, total retail sales of goods and consumer services reached VND 2,799.6 trillion, down 0.4% from the same period last year, if excluding the price factor, the figure would be 4.8 %.

Retail

5. Imports & exports of goods

The Covid-19 epidemic has been spreading rapidly all over the world, continuing to negatively affect Vietnam's import and export activities. Total import and export turnover of goods in 7 months of 2020 was estimated at USD 285.12 billion, which decreased by 1.3% over the same period last year.

Export turnover of goods in July 2020 was estimated at USD 23 billion, increasing by 1.9% over the previous month. Compared to the same period last year, export turnover in July 2020 increased slightly by 0.3%. Generally, in the first 7 months of 2020, export turnover of goods was estimated at USD 145.79 billion, up 0.2% over the same period last year.

Import turnover of goods in July 2020 was estimated at USD 22 billion, up 6.2% over the previous month. Compared to the same period last year, import turnover in July 2020 was estimated to decrease by 2.9, for the first seven months of 2020 in general, import turnover of goods was estimated at USD 139.33 billion, down 2.9% over the same period last year.

Imports & exports of goods

6. Consumer price index and inflation

The consumer price index in July 2020 increased by 0.4% compared to the previous month, mainly due to the fluctuation of domestic gasoline prices in line with world petroleum prices and high demand for electricity and water use during the hot season. However, the consumer price index in July 2020 still decreased by 0.19% compared to December last year, which is the lowest level in the period 2016-2020. On average, in 7 months of 2020, the consumer price index increased by 4.07% over the same period last year.

Core inflation increased by 0.09% over the previous month and by 2.31% over the same period last year. The average core inflation in the first 7 months of 2020 increased by 2.74% compared to the same period in 2019.

>> 
Vietnam’s 6-month economic overview (2Q2020)​

Source: GSO, Complied by VietnamCredit.

Categories:
Vietnam Economy

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