Economic policy should be more circumspect and more supportive of growth recovery

DNHN - After being impacted by the pandemic for more than two years, the country's economy has been altered, gradually regaining development.

The first quarter economic data recently released by the General Statistics Office and the Ministry of Planning and Investment demonstrates this fact - when the majority of indexes exceeded, if not excelled, the same period in 2020 and 2021. 

Experts confirmed that this outcome is the result of coordinated efforts across all economic sectors, as well as appropriate and timely rules and policies. However, given the contemporary setting of uncertain worldwide economic volatility, it is vital to have more delicate and sensitive guidelines and regulations in light of the year-end forecast of 6.5%.

From the reality of production and business in Ho Chi Minh City, Mr. Nguyen Hoang Ly - Chairman of the Board of Directors of Komtek Joint Stock Company said that over the past time, the business community has made great efforts: not only to maintain revenue- To stand firmly in the market, harmonize the management apparatus with available human resources, to ensure the size of the business, but also take advantage of and make good use of the objective advantages brought such as the digital economy, the free trade agreement.

These measures have aided in the rapid recovery of numerous enterprises, thereby adding to overall growth. 

Mr Nguyen Hoang Ly said:”Ho Chi Minh City, Vietnam Vietnamese firms are more adaptable and adapt faster than international enterprises because they are smaller, more adaptable, and easier to move. The second is the opportunity to expand partnerships even during Covid-19, working from home but connecting with overseas partners and adjusting the supply chain or foreign clients via an online platforms; there is no freeze, and many firms are expanding at a higher rate than usual”.

Mr. Nguyen Van Than, Member of the XV National Assembly and Chairman of the Vietnam Association of Small and Medium-Sized Enterprises, concurred with this assessment, stating that the business community and firms throughout the country had made numerous contributions to the recovery process. growth. 

This reality is evident as early as the first quarter of this year, when GDP increased by 5.03% over the same period in 2021, owing to the Government's adaptable and flexible guidelines and policies, as well as its timely and successful immunization approach.

These are the things that alter the situation, gradually restoring growth to production and business operations. It is particularly the initiative and effort of businessmen and firms to take advantage of favorable conditions and advantages created by macroeconomic policies, as well as the worldwide economic setting, that has contributed to the earlier return of growth.

Mr. Nguyen Van Than said:”Vietnamese firms, particularly small and medium-sized enterprises, are notorious for exerting considerable effort on their own. As a result of the Covid-19 pandemic's impact, business potential has resurfaced, forced to do so in order to retain company life. I like such self-reliance, but in the long run, I require assistance to help the business recover more quickly. This Government performs an excellent job with assistance packages and assisting businesses; while there are still some misunderstandings and issues, they have been extremely cooperative in the context of Covid-19”.

According to economic experts, there are still numerous obstacles to overcome in order to meet the National Assembly's year-end growth objective of 6.5%, particularly in light of unexpected global economic developments and the considerable impact of the Russia-Ukraine war.

The economic picture in the first quarter had many bright spots, but there were also deep colors that needed attention and improvement, for example: although the Government urged to disburse investment capital and support industries and sectors, the construction industry still only achieved an increase of 2.57%, showing that the disbursement of investment capital and the implementation of construction and installation has not been as expected; 

The low growth of the wholesale and retail sector reflects the slow recovery of aggregate demand of the whole economy, while together with investment and exports, aggregate domestic demand is the driving force for growth.

Although the business sector contributed more than 60% of GDP, the number of enterprises founded, dissolved, or ceased operations demonstrates that the business community requires additional attention and support.

Assoc. Prof. Dr. Vu Thanh Hung - Senior Lecturer at Paris Management University, France; Former Director of the Institute of Business Administration, National Economics University, proposed:”Businesses' primary objective is to survive and grow, but they function within the confines of the law, which includes administrative procedures; hence, if administrative procedures are many and difficult, the first result is the business. Businesses require considerable work and time investment - none of which contribute to the creation of new value for the firm. Second, it is already a required operation; performing it requires time, but wasted time is lost opportunity. Among the several reasons that drive progress today, one of the most critical is the need to be faster”.

With the same expectation on the efforts of all economic sectors, Dr. Le Xuan Sang - Deputy Director of the Vietnam Institute of Economics suggested:”It is critical to closely monitor price movements in order to effectively manage macroeconomic policy, contain inflation, and boost investment, particularly public investment. Assist production, business, and import and export due to the more unpredictable circumstances than ever before, most notably the impact of the Russia-Ukraine war. Continue reforming the business and investment climate and promoting digital transformation to strengthen the economy's resilience and recovery in the face of numerous uncertainties. Effectively monitor the economic recovery program's 2022-2023 execution of solutions, particularly the development and health of the real estate market and public investment”.

Despite their efforts to research and analyze the current circumstances in order to advocate specific policies, experts stated that the lessons of the previous economic period shown that many pre-planned solutions for economic development may no longer exist. Appropriate when the world is in flux - as the war between Russia and Ukraine demonstrates. 

Thus, both in the short and long run, macroeconomic policy management must be more deft, sensitive, and adaptable, establishing favorable conditions and directions for economic sectors to recover production and business, thereby contributing to overall growth in a more positive manner.

Source VOV1