H1 GDP growth hits 10-year low

The country's second quarter GDP grew by 0.36 percent, compared with an expansion of 6.73 percent in the same period last year, said the GSO.

Vietnam’s low H1 GDP growth is ascribed to the Covid-19 pandemic, which has caused major economies such as the U.S. Japan, and EU to face a deep recession, an interrupted supply chain, a sharp drop in crude oil prices, alongside high unemployment, it said.

In addition, the continuing U.S.-China trade war, increasing political tension between the U.S. and Iran, internal disagreements among oil export organizations and on the Korean peninsula have left a negative impact on the Vietnamese economy, the GSO added.

However, in the current context, the rate is quite positive compared to other countries in the region and the world, it stated.

The manufacturing and construction sector grew by 2.98 percent in H1, contributing 73.14 percent to the GDP. The corresponding figures for the agriculture sector were 1.19 percent and 11.89 percent, and for the services sector were 0.57 percent and 14.97 percent.

The slower pace in Vietnam’s economic growth will put the government’s 2020 economic targets well out of reach, according to the GSO. The National Assembly of Vietnam has recently decided that the country would keep its original GDP target of 6.8 percent for this year, despite Covid-19 impacts.

Last year, GDP growth hit 7.02 percent, the second highest growth figure in the last decade, after a record 7.08 percent in 2018.