Publication: How to Jump Start Vietnam's Economy?
Loading...
Published
2020-04
ISSN
Date
2020-05-20
Author(s)
Morisset, Jacques
Editor(s)
Abstract
COVID-19 has caused an unprecedented shock to the global economy. While Vietnam has shown resilience, the pandemic has resulted in a supply shock as regular work and supply chains are disrupted. It has also caused a demand shock as people cut back their consumption of several services and commodities, not only for restaurants and travel, but throughout the economy given their extreme uncertainties about their economic future. So far, the Government has been very effective in containing the pandemic with a limited number of cases and no registered deaths. The Government has also been active in providing immediate support to the most affected people and businesses through the easing of monetary and credit policies as well as the implementation of a series of fiscal measures. Hopefully the economy will withhold and start to rebound gradually. But it won’t be easy to restart a modern interconnected global economy while the world awaits the arrival of a vaccine that has yet to be discovered. Recovery will begin when health officials can assure people that the new coronavirus has been contained and the mainstream availability of test kits, both to identify the infected and people with antibodies.
Link to Data Set
Citation
“Morisset, Jacques; Inoue, Keiko. 2020. How to Jump Start Vietnam's Economy?. COVID-19 Policy Response Notes;No. 4. © World Bank. http://hdl.handle.net/10986/33778 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Vietnam(World Bank, Washington, DC, 2020-03)Because of the growing economic costs associated with the coronavirus epidemic, many Governments announced a set of new policy measures aimed at mitigating the potential impacts. This note aims to support the Vietnamese Government in its effort to design and implement the most cost-effective package of policy responses. Based on lessons from international experience and on our existing dialogue with the authorities, the recommendation is to adopt a three-step strategy. The first step will focus on supporting the most affected sectors through the combination of targeted tax and financial measures as well as assistance to the most vulnerable firms and employees. The second step will complement the above measures through the accelerated implementation of the public investment program, which will become more effective on the aggregate demand when most restrictions on people’s mobility will have been removed. The third step is to take opportunity of the current crisis, by encouraging priority reforms in the development of a digital economy and the further integration of the Vietnamese economy in global value chains by taking advantage of the diversification needs by multinationals that may want to go away from China.Publication Economic Costs Associated to the Coronavirus Pandemic for Vietnam(World Bank, Washington, DC, 2020-02)The short-term impact of coronavirus outbreak (i.e., 2019-nCov) on Vietnam’s economy could be significant, as high 6-10 percent of monthly output, but short-lived if the outbreak is rapidly contained. While the recent measures by the Government to limit the mobility of people, goods, and services with China will help to prevent the outbreak from spreading to Vietnam, they come with some economic costs. Tourism and electronics trade are the most vulnerable, with one-third of foreign tourists are from China and with over 3 billion dollars per month of bilateral trade between the two countries. The direct costs to contain the epidemic remains relatively small but could increase rapidly if the outbreak spreads within Vietnam, restrictions on mobility are sustained over time and if people behavior amplifies the initial negative impacts. Lessons from experience of recent pandemic show that while the negative costs could be high, the economy tends to recover rapidly once the outbreak is contained. The estimates presented here are highly dependent on assumptions regarding the magnitude and the duration of the epidemic and should be considered as preliminary.Publication Stronger Headwinds Bring New Challenges for the Government(World Bank, Washington, DC, 2020-04)With rising global health and economic concerns, Vietnam economy is expected to be significantly affected, even though the COVID 19 health crisis has been so far contained, with only 240 cases of infected people and no registered death as of early April. The World Bank’s GDP growth forecast for Vietnam has been cut by half compared to pre-crisis projections, with new forecast at 3.0 percent in 2020. Both the fiscal and external accounts are expected to deteriorate, creating a fiscal financing gap of approximately 5 billion dollars that will require new borrowings. The Government’s fiscal response, a combination of tax and social protection measures, is expected to attenuate the short-term economic costs associated to the COVID 19 pandemic, but the key challenges will be the rapid and effective implementation of the above measures and preparing the economy for the expected rebound when the health crisis is contained. Easing monetary and credit policies creates a welcome buffer to the affected businesses, but close monitoring is required as banks become increasingly exposed to the economic slowdown, affecting their asset quality, liability, and profitability over time. Potential areas for collaboration between the Government and the World Bank could include (i) macro and fiscal monitoring; (ii) implementation of social protection measures; and (iii) reforms to be implemented for optimizing the rebound of the economy.Publication Protecting People and Economies(World Bank, Washington, DC, 2020-05)The COVID-19 pandemic has unleashed a global health emergency and an unprecedented economic crisis of historic magnitude. Governments facing this threat are in uncharted territory, but three policy priorities addressed in this note are clear. Disease containment is a first-order concern to combat the pandemic, and measures such as testing and tracing, coupled with isolating and treating the infected can bring first-order gains. The economic crisis requires a parallel and simultaneous effort to save jobs, protect income, and ensure access to services for vulnerable populations. As governments act to slow the pandemic and protect lives and livelihoods now, they will need to maintain macro stability, continue to build trust, and communicate clearly to avoid deeper downturns and social unrest. Looking forward, this crisis can be an opportunity to rethink policy to build back with stronger systems for people and economies.Publication COVID-19 Policy Response Notes for Vietnam(World Bank, Hanoi, 2020-06)‘You can count on your trusted friends in difficult time’. This saying symbolizes Vietnam and the World Bank Group’s long-lasting partnership over the past 25 years, which grows even stronger during difficult times in Vietnam or in the global economy. This has been verified once more during the COVID-19 crisis. Today, Vietnam’s timely and evidence-based response has led to tremendous success in containing the COVID-19 outbreak, with just over 300 positive cases and no deaths. The enviable success story has been applauded across the globe, and the country’s experience has been recently shared by Prime Minister Nguyen Xuan Phuc at the 73rd World Health Assembly organized on May 18-19, 2020. Vietnam’s successful management of COVID-19 has also been extended to the economy, so much that Vietnam is now projected to be one of the few world’s fastest growing countries in 2020. Since the beginning of the COVID-19 pandemic, the World Bank has shared a series of five policy notes with Vietnamese policymakers. These just-in-time notes have supported the Government in its efforts to monitor the current crisis and helped it sequentially to formulate policy responses from the health crisis management through stimulating the recovery of the economy. These notes built on expertise from around the globe, including Hanoi, Washington, DC and beyond. The diagnostics and recommendations stem from the deep dialogue that our experts have fostered with government officials and other stakeholders in Vietnam over the years. They also benefited from expertise based on successes and lessons learned in other countries.
Users also downloaded
Showing related downloaded files
Publication Comoros Country Climate and Development Report(Washington, DC: World Bank, 2025-06-18)The Union of the Comoros (The Comoros) has significant vulnerability to climate change-related risks but has considerable opportunities to strengthen preparedness and resilience against these challenges. According to the Notre Dame Global Adaptation Index, the Comoros is the 29th-most vulnerable country to climate change and the 163rd most ready to adapt (out of 191). The Comoros archipelago is exposed to many natural hazards that adversely affect the country’s natural capital, people, and physical infrastructure. In 2014, the economic cost of climate-related disasters was estimated at 5.7 million dollars annually, equivalent to 9.2 percent of Gross Domestic Product (GDP). Between 2018 and 2023, as many as 11 tropical depressions or cyclones impacted the country, with Cyclone Kenneth causing the greatest damage, equivalent to 14 percent of GDP, resulting in total economic growth falling from 3.6 percent in 2018 to 1.9 percent in 2019. More than 345,000 people (40 percent of the population) were affected by the cyclone, with 185,000 people experiencing severe impacts and 12,000 people displaced. However, there is an opportunity for the country to grow more robust and shock-responsive, and to establish pre-positioned funding mechanisms to enhance future crisis response efforts. For the Comoros, adaptation and climate-resilient development are the key climate change focus areas, with the country projected to face 836 million dollars 2050 in additional costs due to climate-related impacts. Current plans to adapt to the impacts of climate change in the Comoros include efforts to improve water management, strengthen coastal protection, and develop climate-smart agriculture practices. Given the country’s reliance on its natural resource base for economic growth and mobility, protection of these resources from climate change will be essential for promoting resilient growth and development. In addition to growing the adaptive capacity of the country’s natural resource sectors, strategic economic diversification will be important to help minimize future climate impacts, and development activities will need to be undertaken in such a way as to attract low-carbon co-benefits. The Union of the Comoros is committed to addressing climate change through its Nationally Determined Contribution (NDC) and national priorities. The country’s NDC (which was revised in 2021 for a ten-year horizon) sets ambitious targets, with a goal of reducing greenhouse gas emissions by 23 percent by 2030. The country also plans to significantly increase the share of renewable energy in its energy portfolio, reaching 33 MW by 2030. This will not only promote low-carbon development but also reduce the country’s dependency on imported oil and coal, which currently make up 95 percent of the energy mix. Additionally, the Comoros has declared its intention to increase CO2 removals by 47 percent by 2030, compared to BAU.Publication Guinea-Bissau Country Climate and Development Report(Washington, DC: World Bank, 2024-10-23)Guinea-Bissau is endowed with a wealth of natural resources, with the highest natural capital per capita in West Africa (US3,874 dollars per capita), which could be leveraged for sustainable and resilient growth. However, Guinea-Bissau faces significant development hurdles, such as high poverty rates, political instability, and economic challenges, including an over-reliance on cashew nuts. Rural poverty has increased, and the nation's infrastructure, education, and health care systems are underdeveloped. Climate change poses a severe threat, potentially impacting agriculture, fisheries, and infrastructure. Without adaptation, it could lead to a significant cut in real GDP per capita (minus 7.3 percent by 2050) and increase in poverty (with up to over 200,000 additional poor by 2050, that is, 5 percent of the expected population, in the worst scenario). The country's low greenhouse gas emissions are expected to rise, mainly due to agriculture and land-use changes, with deforestation being a major contributing factor. Although Guinea-Bissau is a low emitter, it has high mitigation ambitions, targeting a 30 percent reduction in greenhouse gas emissions by 2030. The Nationally Determined Contribution outlines significant climate actions, with initiatives focused on forest conservation, sustainable agriculture, and community development. However, the country's political instability, institutional weaknesses, and limited financial resources pose challenges to implementing these climate commitments, which depend heavily on external funding. The financial sector's underdevelopment and vulnerability to external shocks limit its ability to support green investments, though reforms could enhance resilience. Guinea-Bissau must consider its climate financing as development financing and vice-versa, engage the private sector, and integrate climate goals with national development plans to ensure a sustainable future. Concessional climate financing is vital due to the underdeveloped financial sector and the government’s limited borrowing capacity. Addressing Guinea-Bissau's vulnerability to climate change and its structural issues requires a cohesive approach that integrates development and climate strategies. This could involve improving governance, diversifying the economy, protecting natural capital, developing human capital, and investing in sustainable agriculture and infrastructure. The transition to a more sustainable and inclusive development pathway that supports economic growth is possible, but requires focusing on key strategic sectors, enhancing institutional capacity, and creating the conditions to mobilize finance. As a highly vulnerable country, there are myriad needs in the different sectors; however, to be more efficient and effective, Guinea-Bissau should prioritize actions in a few sectors, especially actions on biodiversity, agriculture, and social protection. Low carbon development, especially in energy and forestry sectors, could provide cost-efficient solutions and attract climate finance, including from the private sector, which will support the overall development agenda.Publication The Government Analytics Handbook(Washington, DC: World Bank, 2023-09-28)The Government Analytics Handbook presents frontier evidence and practitioner insights on how to leverage data to strengthen public administration. Covering a range of microdata sources—such as administrative data and public servant surveys—as well as tools and resources for undertaking the analytics, it transforms the ability of governments to take a data-informed approach to diagnose and improve how public organizations work. The "Handbook" is a must-have for practitioners, policy makers, academics, and government agencies. It is available as a single volume in print or digital formats, and as chapters for modular use. Additional tools, data and background information are available at worldbank.org/governmentanalytics. “Governments have long been assessed using aggregate governance indicators, giving us little insight into their diversity and how they can practically be improved. This pioneering handbook shows how microdata can be used to give scholars and practitioners granular and real insights into how states work, and practical guidance on the process of state-building.” —Francis Fukuyama, Stanford University, author of State-Building: Governance and World Order in the 21st Century - "The Government Analytics Handbook is the most comprehensive work on practically building government administration I have ever seen, helping practitioners to change public administration for the better.” —Francisco Gaetani, Special Secretary for State Transformation, Government of Brazil - “The machinery of the state is central to a country’s prosperity. This handbook provides insights and methodological tools for creating a better shared understanding of the realities of a state, to support the redesign of institutions, and improve the quality of public administration.” —James Robinson, University of Chicago, coauthor of Why Nations FailPublication Mongolia Country Climate and Development Report(Washington, DC: World Bank, 2024-10-22)Mongolia’s development prospects are uniquely challenged by both the impacts of climate change and the global shift toward a low-carbon economy. The country’s efforts toward decarbonization pose significant challenges given the structurally high-emission intensity of its economy. While challenging, climate action also presents Mongolia with opportunities to achieve important development benefits. The effects of climate risks and the shift away from coal will have diverse impacts across different regions, communities, and socioeconomic levels. The report assesses the critical interconnections between Mongolia’s development ambitions and climate change action and identifies ways to transition to a more economically diversified, inclusive, and resilient development path. It highlights key climate and transition risks affecting Mongolia’s future development and presents a pathway to enhance climate mitigation and adaptation. The report also makes a case for strengthening policies to enhance resilience to climate change and ensure a just transition, particularly for the most vulnerable. The report is structured as follows: section 1 gives introduction. Section 2 delves into the linkages between development and climate in Mongolia and presents model-based findings on the economic and poverty impacts of climate change under different scenarios. Section 3 covers four in-depth sectoral analyses. The first two mainly focus on adaptation to climate change in the agriculture and water sectors. The third considers prospects for the extraction sector, while the fourth sectoral analysis focuses on decarbonizing power and heat generation. Section 4 shifts the focus to how the government can boost resilience for climate-vulnerable populations. Section 5 outlines options for mobilizing private and public financing and private investments to support the green transition. Section 6 examines the existing institutional and governance structure for climate action and presents recommendations to improve its effectiveness, and section 7 concludes with a framework for prioritizing the policy actions outlined in this report.Publication Kyrgyz Republic Country Climate and Development Report(Washington, DC: World Bank, 2025-11-03)This Country Climate and Development Report (CCDR) on the Kyrgyz Republic aims to support the country’s development goals amid a changing climate. The CCDR considers two policy scenarios up to 2050: the business-as-usual (BAU) and high-growth scenarios. As it quantifies the likely impacts of climate change on the Kyrgyz economy between now and 2050, the report highlights key government actions to best prepare for and adapt to climate impacts (referred to as “with adaptation” measures), with a particular focus on the time horizon up to 2030. The CCDR also outlines a path to net zero emissions by 2050 (referred to as “with mitigation” measures, “decarbonization,” or, simply, “net zero 2050”), highlighting associated development co-benefits.