The VEPR’s report said the global economy has shown signs of recovery thanks to the availability of COVID-19 vaccines, but instability remains while growth is uneven among nations and economies.

Export is a bright spot of the economy. (Photo for illustration)

In the first quarter, Vietnam’s economic growth hit 4.48 percent thanks to the Government’s drastic actions to control the pandemic from the early stage, along with the signing of the European Union – Vietnam Free Trade Agreement and the EU-Vietnam Investment Protection Agreement.

Additionally, disbursement of public investment capital has been stepped up and progress of key public investment projects accelerated while the wave of investment and trade is shifting to Vietnam, helping maintain a stable macro-economic environment with inflation under control.

However, Anh also warned that Vietnam is facing challenges in an uncertain economic environment. The resurgence of the COVID-19 pandemic in many countries resulting in lockdown measures is prolonging the disruption of supply chains this year, weakening the resilience of enterprises. Geo-political conflicts among major powers could also expose Vietnam to unexpected risks.

Other risks are related to fiscal imbalance, slow and low investment, vulnerable financial-banking system, and growth’s heavy reliance on foreign-invested sector.

The VEPR suggested that the top priority should be given to social welfare policies, targeting the right persons.

The report also proposed that corporate support policies should be continued with more substantial measures and greater focus.

According to Anh, Vietnam should gradually build fiscal cushion to prevent shocks like COVID-19 or its unexpected developments in coming years.

Source: VNA