Vietnam’s 2020 GDP growth could fall to 7-year low

By Anh Minh February 12, 2020 | 11:01 pm PT

A man sanitizes a train at Saigon Railway Station in Ho Chi Minh City on February 7, 2020. Photo by VnExpress/Quynh Tran.

The severity of the novel coronavirus epidemic is likely to drag Vietnam’s GDP growth down to 5.96 percent this year.

The projected growth rate, lowest since 2013, assumes that the Covid-19 epidemic is contained in the second quarter, according to a report released by the Ministry of Planning and Investment Wednesday.

If the disease is contained in the first quarter, the growth is estimated at 6.25 percent, still a drop from 7.02 percent last year.

In both scenarios, growth will fail to meet the target of 6.8 percent, it is envisaged.

The ministry has also forecast that inflation could reach 3.96 percent or 4.86 percent, against a target of 4 percent.

The latest forecast of the planning ministry is lower than the 6.09 percent it had estimated last week. But it had also said that forecasts are likely to change with the government’s interventions to boost the economy amidst the epidemic.

Vietnam’s key industries are likely to be hit hard by the Covid-19 epidemic this year.

The Vietnam Tourism Advisory board has estimated a revenue loss of between $7 and $15 billion.

Local airlines have reported losses of VND10 trillion ($430.5 million) from over 400 weekly Vietnam-China flights being canceled, according to the Civil Aviation Authority of Vietnam.

From 2017-2019, Vietnam’s annual GDP growth had exceeded 6.8 percent and was among the fastest growing economies in ASEAN.