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Vietnam’s economic overview (1Q2021)

Vietnam’s economic overview (1Q2021)

Saturday 03, 04 2021
The report on Vietnam’s economic overview in the first quarter of 2021 by GSO indicates that the gross domestic product (GDP) was estimated to increase by 4.48% over the same period last year, higher than the growth rate of 3.68% in the first quarter of 2020.

Below is an overview of Vietnam’s economy in the first quarter of 2021 compiled by VietnamCredit.

Covid-19

1. GDP growth

In the first quarter of 2021, gross domestic product (GDP) was estimated to increase by 4.48% over the same period last year, higher than the growth rate of 3.68% in the first quarter of 2020. In particular, the agriculture, forestry and fishery sector increased by 3.16%, contributing 8.34% to the general growth rate; the industrial and construction sector rose by 6.3%, contributing 55.96%; the service sector increased by 3.34%, contributing 35.70%.

GDP Vietnam

Regarding Vietnam’s economic structure in the first quarter, the agriculture, forestry and fishery sector accounted for 11.71%; the industrial and construction sector accounted for 36.45%; the service sector accounted for 42.20%; the product tax minus product subsidies accounted for 9.64% (the corresponding structure of the same period in 2020 was 11.66%; 35.86%; 42.82%; 9.66%).

As for the use of GDP in the first quarter of 2021, final consumption increased by 4.59% over the same period in 2020; asset accumulation increased by 4.08%; exports of goods and services rose by 17.01%; and imports of goods and services rose by 16.38%.

Agriculture

Forestry

Fishery

 2. Industrial production

The added value of the whole industrial sector in the first quarter of 2021 was estimated to increase by 6.5% over the same period last year. In particular, the manufacturing sector increased by 9.45%, contributing 2.37 percentage points to the general growth; electricity production and distribution increased by 4.50%, contributing 0.17 percentage points; water supply and waste treatment increased by 3.78%, contributing 0.02 percentage points; mining and quarrying decreased by 8.24% due to the sharp decline in crude oil and natural gas extraction, reducing the overall growth rate by 0.36 percentage points.

Industrial

Consumption index for the manufacturing sector in March 2021 increased by 24.1% over the previous month and by 5.3% over the same period last year. Generally, for the first quarter of 2021, the consumption index increased by 5.8% over the same period last year.

3. Business registration

In March 2021, there were 11,171 newly established enterprises with registered capital of 113 trillion VND and number of registered employees of 72.8 thousand people, which is an increase of 39% in number of enterprises, a decrease of 37.1% in registered capital and an increase of 27.8% in number of employees compared to February 2021. The average registered capital of a newly established enterprise in March reached 10.1 billion VND, decreasing by 54.8% over the previous month and by 5.5% over the same period last year.

Business

For the first quarter of 2021, there were 29.3 thousand newly registered enterprises with a total registered capital of 447.8 trillion VND, and the total number of registered employees was 245.6 thousand workers, a decrease 1.4% in number of businesses, an increase of 27.5% in registered capital and 0.8% in number of employees over the same period last year. The average registered capital of a newly established.

There were 40.3 thousand enterprises temporarily suspending business operation, stopping operations waiting for dissolution procedures and completing dissolution procedures in the first quarter of this year. On average, each month saw 13.4 thousand enterprises withdrawing from the market.

4. Investment

Realized investment capital in the first quarter of 2021 at current prices was estimated at 507.6 trillion VND, up 6.3% over the same period last year and equaling 26.5% of GDP.

As of March 20, 2021, the total foreign investment capital in Vietnam including newly registered capital, adjusted registered capital and capital contribution and share purchase of foreign investors reached nearly 10.13 billion USD, up 18.5% over the same period last year. Specifically, there were 234 newly licensed projects with registered capital of 7.2 billion USD, decreasing by 69.1% in number of projects and 30.6% in registered capital over the same period last year. Realized FDI capital in the first quarter of 2021 was estimated at 4.1 billion USD, up 6.5% over the same period last year.

Investment

There were 14 Vietnamese investment project in other countries in the first quarter of 2021 with a total capital of 140.2 million USD, 6 times higher than the same period last year. Generally, the total investment capital of Vietnam abroad (including new and additional capital) reached 572.1 million USD.

5. Retail sales of consumer goods and services

Total retail sales of consumer goods and services in March were estimated at 405.1 trillion VND, down 3.8% from the previous month and up 9.2% over the same period last year. Generally, in the first quarter of 2021, the total retail sales of consumer goods and services reached 1,291.1 trillion VND, up 5.1% over the same period last year, if excluding the price factor, it would increase 4.42%.

Telecommunications activities in the first quarter of 2021 were generally stable with estimated revenue of 78.9 trillion VND, a slight decrease of 0.3 percent compared to the same period last year.

Retail sale

International visitors to Vietnam in March 2021 were estimated at 19.4 thousand arrivals, which is an increase of 77.3% over the previous month and a decrease of 95.7% over the same period last year. For the first quarter of 2021 in general, the number of international visitors to Vietnam were estimated at 48.1 thousand arrivals, decreasing by 98.7% over the same period last year.

6. Imports & exports of goods and services

a) Imports & exports of goods

Regarding the structure of goods export in the first quarter of 2021, the heavy industrial goods and minerals were estimated at 43.2 billion USD, up 25.9% over the same period last year. Light industry and handicraft products were estimated at 27.1 billion USD, up 20.6%. Export value of agricultural and forestry products reached 5.35 billion USD, up 7.9% while that of fishery products reached 1.69 billion USD, up 3.3%.

The United States was the largest export market of Vietnam in the first quarter with a turnover of 21.2 billion USD, an increase of 32.8% over the same period last year; followed by China with 12.5 billion USD, up 34.3%; EU market with 9.6 billion USD, up 14.2%; ASEAN market with 6.5 billion USD, up 3.4%; South Korea with 5 billion USD, up 6.4%; and Japan with 4.9 billion USD, down 1.5%.

In the structure of goods import for the first quarter of 2021, import value of materials for production was estimated at 70.58 billion USD, up 26.8% over the same period last year and accounting for 93.7% of the total goods import turnover.

Regarding the import market of goods, China was still the largest import market of Vietnam with a turnover of 23.8 billion USD, an increase of 47.3% over the same period last year; followed by Korea with 13 billion USD, up 9.9%; ASEAN market with 9.3 billion USD, up 26.3%; Japan with 5.1 billion USD, up 4.8%; EU market with 4 billion USD, up 15.4%; and the United States with 4 billion USD, up 12.3%.

The first quarter of 2021 saw a trade surplus of 2.03 billion USD, of which the trade deficit of the domestic economic sector was 6.75 billion USD while foreign invested sector (including crude oil) saw a trade surplus of 8.78 billion USD.

Import & Export

b) Imports & exports of services

In the first quarter of 2021, service export turnover was estimated at 869 million USD, down 77.2% over the same period last year, of which travel services reached only 34 million USD (accounting for 3.9% of the total turnover), down 98.6%; transportation services reached 70 million USD (accounting for 8.1%), down 86.9%. Import turnover of services in the first quarter of this year was estimated at 4.98 billion USD, down 1.5% from the same period last year. There was a trade deficit of 4.11 billion USD in services in the first quarter of 2021, nearly 5 times higher than the service export turnover and increasing by 2.86 billion USD over the same period last year.

7. Consumer price index and inflation

The consumer price index (CPI) in March 2021 decreased by 0.27% over the previous month. Average CPI in the first quarter of 2021 increased by 0.29% over the same period in 2020.

Core inflation in March 2021 decreased by 0.12% over the previous month and increased by 0.73% over the same period last year. Average core inflation in the first quarter of 2021 increased by 0.67% over the same period last year.

Source: GSO

 

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Vietnam Economy

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