Vietnam's GDP in 2020 increased by 2.91%, among the highest growth rates in the world

“GDPIn 2020, the GDP increased by 2.91%, the lowest growth rate in the period 2011 - 2020. However, in the context of the complicated developments of the Covid-19 pandemic, negatively affecting all economic and social sectors, this is a great success for Vietnam with the growth rate in 2020 among the highest in the world" - Ms. Nguyen Thi Huong - General Director of the General Statistics Office discussed at the press conference announcing the socio-economic statistics of the fourth quarter and the whole year of 2020, on December 27.

GDP growth in the fourth quarter is positive

Ms. Huong said that the Covid-19 epidemic was strictly controlled, the economy gradually resumed operations under new normal conditions, the Free Trade Agreement between Vietnam and the European Union (EU) took effect from August 1... created momentum for the economy, contributing to the GDP growth in the fourth quarter compared to the third quarter. Accordingly, the gross domestic product (GDP) in the fourth quarter is estimated to increase by 4.48% over the same period last year, but this is also the lowest growth rate in the period 2011-2020.

Thus, with the GDP growth rate of the first quarter being 3.68%, the second quarter increasing by 0.39%, the third quarter increasing by 2.69% and the fourth quarter increasing by 4.48%, the gross domestic product for the whole year of 2020 increased by 2.91%. This is a great success for Vietnam as the growth rate for the whole year is among the highest in the world, in the context of the pandemic.Covid-19rife.

Source: General Statistics Office

“This shows the correctness in directing and operating economic recovery, disease prevention and control, and the determination and consensus of the entire political system, the Government, the Prime Minister, and the efforts of the people and the business community to effectively implement the goal of both disease prevention and socio-economic development,” said Ms. Huong.

Notably, in the overall growth of the entire economy, the agriculture, forestry and fishery sector increased by 2.68%, contributing 13.5% to the growth rate of the total added value of the entire economy. In addition, the industry and construction sector increased by 3.98%, contributing 53% and the service sector increased by 2.34%, contributing 33.5%.

Promoting agricultural strengths

Pointing out some highlights that created growth momentum, Ms. Huong said that in the agriculture, forestry and fishery sector, the output of some perennial crops and livestock products increased quite a bit during the year, so the growth rate of this sector was higher than in 2019. Thanks to that, the agricultural sector had a growth rate of 2.55%, only lower than the growth rates of 2011, 2012 and 2018, contributing 0.29 percentage points to the total added value of the entire economy.

Besides, the industrial sector increased by 3.36% over the previous year and contributed 1.12 percentage points; in which the processing and manufacturing industry played a key role in leading the economic growth with an increase of 5.82% and contributed 1.25 percentage points.

Source: General Statistics Office

However, the Covid-19 pandemic has seriously affected trade and service activities. Therefore, the service sector has the lowest growth rate in the past 10 years. Some market service sectors contributed a large proportion to the growth rate of total added value, such as wholesale and retail trade increased by 5.53% compared to the previous year, contributing 0.61 percentage points; finance, banking and insurance activities increased by 6.87%, contributing 0.46 percentage points.

Regarding the economic structure in 2020, Ms. Huong said that the agriculture, forestry and fishery sector accounted for 14.85%, the industry and construction sector accounted for 33.72%, the service sector accounted for 41.63%, and product taxes minus product subsidies accounted for 9.8% (the corresponding structure in 2019 was 13.96%; 34.49%; 41.64%; 9.91%).

Notably, the labor productivity of the entire economy at current prices in 2020 is estimated at 117.9 million VND/worker (equivalent to 5,081 USD/worker and an increase of 290 USD compared to 2019). At comparable prices, labor productivity increased by 5.4% due to the increasingly improved qualifications of workers (the rate of trained workers with degrees and certificates in 2020 reached 24.1% and higher than the 22.8% of 2019).

Previously, the investment efficiency index (ICOR) decreased from 6.42 in 2016 to 6.08 in 2019. On average, in the 2016-2019 period, the ICOR reached 6.13, lower than the 6.25 level in the 2011-2015 period.

“However, in 2020, due to the negative impact of the Covid-19 epidemic, the production and business activities of the economy were stagnant, and completed projects put into use have not yet promoted their capacity, so the ICOR in 2020 reached 14.28 and the average ICOR coefficient in the period 2016-2020 was 7.04,” said Ms. Huong.