Focusing on overcoming the consequences of the COVID-19 pandemic, making best efforts to restore and develop national socio-economy

Controlling the COVID-19 pandemic

When the first case of COVID-19 infection in the world was discovered in December 2019 and the World Health Organization (WHO) identified COVID-19 as a pandemic on March 11, 2020, various measures to cope with COVID-19 epidemic have been adopted by Viet Nam and other countries. Up to July 13, 2020, there were 13 million cases of infection, more than 571,000 deaths; these numbers are still increasing rapidly every day. While others have difficulties in preventing and controlling the pandemic, Viet Nam has recorded only 372 cases, of which 350 patients have been discharged from the hospital and no deaths recorded. Achieving this important result is due to our early awareness, appropriate and timely policy, focused and continuous direction, effective, synchronous and decisive action with a spirit of determination and solidarity, the strength of the entire nation, the support and joint action of the entire people under the leadership of the Party.

Up to now, Vietnam has managed to control and stop the spread of the epidemic in the community, and is now proactively and actively moving to the phase of overcoming the impact of the COVID-19 pandemic, recovering and developing the national socio-economy. International organizations, such as the United Nations, WHO, etc., various countries and major reputable media companies in the world have considered Viet Nam as a reasonable, effective and low-cost anti-epidemic model supported by a large number of people and enterprises.

The decisive factors for this success include the sound and regular direction of the Politburo, the Secretariat, the National Assembly, the National Assembly Standing Committee, the Government, the Prime Minister; the unification in people awareness; the drastic direction and timely implementation of the whole political system; the close and rhythmic coordination of the Steering Committee for preventing and fighting against COVID-19 epidemic at all levels and sectors; the agreement, support and joint action of the people and the business community and especially the high determination and best efforts of the Party Committees and authorities at all levels. This has really created the spirit of national solidarity, promoting the general strength, resources and wisdom of the whole country, arousing patriotism, and the spirit of mutual love, contributing to consolidating the people's belief in the wise leadership and management of the Party and State and affirming the superior and good nature of our regime. Viet Nam has also received colossal assistance and support from friends and international community; Viet Nam, in turn, has shared experience, provided medical supplies and equipment, which has contributed to promoting the role of ASEAN President as well as Non-Standing member of the Security Council of the United Nations.

The impacts of the COVID-19 pandemic on the national socio-economic development

In the context of a large open Vietnamese economy; deepening international economic integration; slow process of economic restructuring; limited autonomy and resilience of the economy to the world's abnormal fluctuations..., the COVID-19 pandemic not only caused heavy damage to most socio-economic sectors and fields, especially services, tourism, transportation (especially aviation), catering, accommodation, entertainment, etc., interrupting supply chain and trade flows, but also strongly affected the people’s psychology and life.

Gross domestic product (GDP) in the second quarter of 2020 only rose by 0.36% compared with the same period last year, which was the lowest growth rate of the second quarter of the years in the period 2011 - 2020. GDP in the first 6 months of 2020 increased by 81%. Despite being the lowest growth rate of the first 6 months of the years in the period 2011 - 2020, it was still the highest in Asia.

In the first 6 months of the year, the whole country had more than 62 thousand enterprises registered for an establishment with a total registered capital of 697.1 trillion dong and the total number of registered employees was 507.2 thousand workers; the number of enterprises decreased by 7, 3%; the registered capital decreased by 19% and the number of employees climbed down by 21.8% compared to the same period last year. The average registered capital of a newly established enterprise in the first 6 months of 2020 was 11.2 billion dong, decreasing by 12.5% in comparison with the same period last year. At the same time, there were also up to 29,200 enterprises temporarily suspending their business activities, increasing by 38.2% compared to the same period last year. The social investment capital in the first half of 2020 increased by 3.4% compared to the same period in 2019, and this was the lowest growth rate in the 2016-2020 period.

A number of enterprises faced difficulties, including interrupted and scarce supply of raw materials and falling output market, especially export market. In such a context, the costs of operation of enterprises became a burden while the shortage of cash flow was gradually increasing, especially the shortage of working capital to pay labor wages (this is the biggest burden), loan interest, property rent and other regular activities; there was a decline in revenue and even loss. However, businesses have been resilient to maintain production, protect their workers, which is always welcomed. Those include mainly major ones; the resilience of small, medium enterprises, is still limited.

Education and training activities faced with massive difficulties. The decision on social distancing allowing 21 million pupils and students to be off school was a very important and timely decision in the prevention and fight against the spread of the epidemic; however, this not only changed the overall education plan of schools, learning of students but also affected parents, especially parents with school children.

In such context, the drastic measures to prevent and combat the pandemic and restore socio-economic activities, and minimize damages have created positive impacts on Viet Nam’s economy in various aspects and have opened up new development opportunities: 1- The ability to cope with epidemics at all levels has been intensified; capacity of the health sector, especially public health, has been improved; 2- The confidence of the people and enterprises in the leadership and management of the Party and State as well as the national pride has been greatly enhanced; 3- Viet Nam's external relations have been strengthened through its efforts to proactively cooperate internationally in response to the COVID-19 pandemic; 4-  In spite of difficulties, exports and imports only witnessed slight decrease, while trade surplus reached 4 billion USD (the highest level compared to the same period in the past 4 years; many items such as medical equipment, agricultural products have found opportunities to penetrate new markets; 5- Digital transformation process has been prioritized to develop everywhere in the world, including Viet Nam, promoting the development of e-commerce, digital business, e-government, scientific and technological activities associated with epidemic prevention and control.

At the same time, the rearrangement of global production and supply chains according to diversification, reducing dependence on some markets will be an opportunity for countries like Viet Nam, if we succeed in building trust and affirming production capacity, supplying input materials together with ensuring human resources, infrastructure, etc., this will enable the country to attract high-quality investment capital flows, reinforce the foundation for rapid and sustainable development.

Currently, Viet Nam has driven back and well-controlled the COVID-19 epidemic; socio-economic activities are rapidly coming to a new normal state. The country is facing a new opportunity when the world order, the mode of producing, trading, and consuming, the behavior and psychology of people and businesses have been drastically changed. The COVID-19 pandemic has also allowed Viet Nam to participate in newly created or re-established value chains with an active position right from the beginning, participate in establishing conventions in these value chains, especially in major markets, such as countries under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Free Trade Agreement between the European Union and Viet Nam (EVFTA). Owing to the results of the COVID-19 epidemic prevention and control, Viet Nam's image is being enhanced, along with the stability of politics, macroeconomics, investment and business environment being strongly improved. Viet Nam has proven to be a reliable destination for international visitors, domestic and foreign investors.

Performing a dual task: Effectively preventing and combating the COVID-19 pandemic as well as developing national socio-economy

The COVID-19 pandemic in 2020 is a great lesson about the epidemic response of different countries. A country which has overcome this pandemic is a country that knows how to well adapt and control epidemics, quickly rehabilitate socio-economy, and make good use of new opportunities in the absence of vaccines and special medicines for this disease.

At present, the goal for Viet Nam is to control the COVID-19 epidemic well, prevent community infection, and actively prepare scenarios and plans for the rapid recovery and development of the socio-economy in a sustainable way during and immediately after the end of the COVID-19 epidemic. Quickly overcoming and removing difficulties in production and business; ensuring social security, life, livelihood, and employment for the employees, the poor and the disadvantaged. Looking for and promoting new growth motivations that can replace and compensate for the losses caused by the epidemic. Developing special policies, preparing resources to support a number of economic sectors in order to consolidate and improve their competitiveness, take advantage of the opportunities to dominate the market. Clearly identifying opportunities and challenges to propose solutions in which opportunities and challenges are taken advantage of and transformed into new growth motivations, accelerating the process of economic restructuring, including digital change. Improving the internal capacity and competitiveness of the economy, raising the level and enhancing the national rank in a number of sectors and fields.

The COVID-19 epidemic and its impact are unprecedented worldwide, and countries, even ones with powerful economy, are taking drastic measures beyond normal regulations. In the coming time, it is necessary for Viet Nam to seriously, drastically, synchronously and effectively implement the guidelines, lines, tasks and solutions set out in the General Secretary and the President’s Call for COVID-19 epidemic prevention and control, the direction of the Politburo, the Secretariat, the National Assembly, the National Assembly Standing Committee, the Government, and the Prime Minister; in which it is essential to immediately implement strong policies and solutions, apply specific procedures in the context of the COVID-19 pandemic; there are a number of the key tasks as follows:

Firstly, it is necessary to focus on speeding up the progress rate and effectively implementing the support packages, mainly including the monetary and credit policy package, the fiscal support package, and the social security support package. These packages are being actively deployed, but this is still slow and there are still many barriers; Therefore, it is vital to immediately remove these challenges, propose to expand the appropriate fiscal package, increase access to capital, support both small, micro and large enterprises to contribute, spread, and create jobs. It is resolute not to let delay and self-seeking behavior in this urgent task.

Secondly, strongly promoting Viet Nam's economic growth engine which is known as a three-horse vehicle, including exports, investment and consumption; in order to make these sectors lift up the growth engine as high as possible.

Therefore, it is important to promote exports, especially markets with plenty of fiscal space after the pandemic, such as the US, the European Union, the Association of Southeast Asian Nations (ASEAN), Japan, China and South Korea. These are 6 markets accounting for 80% of the total export turnover of Viet Nam; especially markets in the countries belonging to CPTPP and EVFTA (will take effect from August 1, 2020).

At the same time, promoting disbursement and improving the efficiency of the use of public investment capital. Resolutely accelerating site clearance, timely allocating reciprocal capital sources and speeding up the disbursement of official development assistance (ODA), closely linking the effective disbursement target of public investment with the assessment of the head’s completing the task. Overall reviewing regulations on state budget deficit, public debt, government debt, foreign debt, etc. considering the regulation of an appropriate public debt / GDP ratio to increase resources for investment, and strengthening the strict control over the efficiency of the use of public investment capital. Preparing and building a medium-term plan for public investment for the period 2021 - 2025, serving the direction and goals of socio-economic development in accordance with the Resolution of the XIII National Congress of the Party; in which, concentrating investment capital on key projects with great pervasiveness, solving infrastructure bottlenecks, responding to climate change, landslide, saline intrusion and solving problems of national and regional development, facilitating the attraction of private investment, foreign direct investment (FDI); considering and converting a number of investment projects in the form of public - private partnership (PPP) to full investment from the state budget and vice versa, ensuring openness and transparency;  having a mechanism to monitor, manage and effectively use investment capital for each project. Disbursement of public investment capital (including official development assistance - ODA) can be considered as an urgent task that all levels and branches need to focus on to achieve good results. The Government has strongly urged and taken resolute and timely handling measures.

To attract new investment, it is crucial to carefully prepare essential conditions, such as infrastructure (especially the infrastructure of the industrial park with accompanying services, telecommunications infrastructure), premises; quick and consistent policies and procedures with little changes; developing skilled human resources; formulating policies, filtering criteria to attract specific investment, associated with national, regional and local development strategies; effectively implementing Resolution No. 50-NQ / TW, dated 20-8-2019, of the Politburo, “On the direction of completing institutions, policies, improving the quality and efficiency of investment cooperation foreign countries until 2030 ”.

Promoting stimulus for domestic consumption; with the scale of Viet Nam's personal consumption equivalent to 82% of GDP and contributing about 12% of GDP, focusing on stimulating demand in some sectors and fields, such as tourism, retail, transportation, accommodation, eating, drinking, and health care, etc; developing a healthy and efficient consumer credit market, minimizing black credit.

Thirdly, continuing to promote institutional reform and improvement to clear bottlenecks, release resources, develop and improve national governance capacity.

Strongly reforming, improving the efficiency of law construction and enforcement; removing problems in administrative procedures, speeding up approval procedures, adjusting new policies, especially start-up procedures, immediately implementing large-scale and important projects which have spillover effects on socio-economic development of different localities, regions, branches and domains.

Implementing consistently and thoroughly reforming administrative procedures, improving the nature of the investment and business environment; focusing on dealing with bottlenecks and shortcomings that hinder business development, especially the private economic sector. Continuing to review and resolutely eliminate unnecessary business conditions and administrative procedures, and unofficial fees. Accelerating the implementation of the national single-window mechanism associated with the application of information technology and the provision of public services online, contributing to reducing time and costs for businesses and investors. Properly transforming the inspection and supervision mechanism from pre-check to post-check, associated with the transparency of handling sanctions, which are sufficiently deterrent; reducing the number, avoiding overlapping in inspection, check and audit. Resolutely and promptly handling cases of harassment, manipulation and law violation when performing official duties, delaying the time and progress of performing assigned tasks; replacing the cadres, civil servants and public employees who are weak in capacity, qualifications and unable to meet the requirements.

Speeding up the development of policies and laws on e-government building in the direction to a digital government, completing the legal framework for new business models based on digital technology, high technology, business models sharing transacting and managing digital assets, electronic money, new payment methods, electronic identity and authentication systems, etc. In particular, it is important to pay special attention to stimulus policies on finance (taxes, fees, access to start-up capital markets, venture capital, corporate bonds, SME credit guarantees, etc.), credit policy (increasing credit access ability, especially priority sectors, new business areas, etc.); considering these as tools and levers to promote the development of new business models, the development of new materials, new energies and new growth engines.

Fourthly, accelerating the process of restructuring the economy in each sector and field, attached to the requirement of building an autonomous and resilient economy, improving the adaptability and resilience of the economy.

In the new state of the economy, it is vital to focus on restoring broken supply and value chains, proactively participating in building and developing new value chains. Putting great emphasis on developing domestic supporting industries, increasing the initiative in raw materials and input materials, as well as replacing a part of import sources, increasing the ability to connect with FDI enterprises. Restructuring export markets in the direction of market diversification, avoiding dependence on one market; increasing export through official channels, meeting commodity standards, regulations on traceability and geographical indications; In particular, it is necessary to focus on building and deploying a system of traceability, meeting regulations and standards in accordance with international practices, to promptly respond to the plan to divert exports to new markets.

Together with that, it is critical to improve the competitiveness of the country and businesses; particularly, attention should be paid to improving the capacity of innovation, creativity, adaptation, production and developing the domestic consumption market; developing a workforce with high professional qualifications; continuing to increase foreign exchange reserves; cleaning up financial system, focusing on capital market development, perfecting the legal corridor so that businesses can use tools to prevent risks of exchange rates, interest rates, market fluctuations, etc. Each ministry, sector, locality, and enterprise needs to proactively improve their competitiveness, strongly improve the indicators showing their governance capacity (such as the Provincial Competitiveness Index - PCI, Provincial Governance and Public Administration Performance Index - PAPI, Corporate Governance Index - CGI ...); understanding the impact of the operating environment on the economy and each specific locality, industry, business; Strengthening the capacity to synthesize, analyze, forecast and developing appropriate response scenarios when a shock occurs.

Fifthly, ensuring social security, creating jobs, training human resources in the new state.

Implementing policies to support social security in an effective, public and transparent manner, not to take advantage of the policies, including Resolution No. 42 / NQ-CP, dated April 9, 2020, of the Government, "On measures to support people facing difficulties caused by the COVID-19 pandemic" and Decision No. 15/2020 / QD-TTg, dated April 24, 2020, of the Prime Minister, Regulations on the implementation of Policies to support people facing difficulties due to the COVID-19 pandemic. Focusing on adjusting policies, promptly removing problems; solving employment problems for workers, ensuring enough workforce when entering the stage of increasing production and business after the epidemics.

Strengthening the training and development of high-quality human resources in key industries and fields, associated with the market, to meet the requirements of the Fourth Industrial Revolution with the shift of investment capital flows, the structural transformation of the global economy. Concentrating on supporting employers to train and retrain employees to meet new requirements.

Mobilizing and using different resources efficiently, implementing solutions to develop a healthy, synchronous, transparent, competitive and sustainable labor market, strengthening and enhancing the role of the State in the management and regulation of supply and demand in the labor market. Completing the labor market information system; promoting the connection between labor supply and demand across the country associated with the international labor market. At the same time, it is necessary to strongly renovate the work of planning and vocational training, including finance to mobilize resources from both central and local levels.

Sixthly, boosting the development of key economic regions, aiming to bring into full play their advantages, promoting internal forces and regional cooperation. Expanding new growth drivers, and developing favorable urban economy according to planning.

Bringing into play the strengths of key economic regions, large urban centers which are the locomotive for socio-economic development, the center for formulation and implementation of policies for sustainable, synchronous and systematic regional development creating a spillover effect; especially the cities directly under the Central Government, provinces and cities with central positions in economic triangles and quadrilateral.

Promoting intra-regional, inter-regional and international links, organizing new production and business models, and forming clusters, industries, chains of production and supply and value; creating a new development space suitable to the socialist-oriented market economic institution. Accordingly, it is necessary to soon complete the institution of regional linkage in the direction of efficiency, transparency and feasibility; developing and planning transport infrastructure, regional connectivity projects, cooperating in investment and development, including investment cooperation between businesses - cooperatives - households and cooperation in production chains, value chains. In the immediate future, there should be a pilot mechanism for developing cooperations in regions, industries and chains; there should be evaluation, review and replication according to the appropriate roadmap. At the same time, expanding and promoting new growth drivers such as urban economy, digital economy, night economy, new materials industries, new energy, etc. Viet Nam’s potentials and strengths need to be enhanced and promoted./.