September 19, 2020 10:22

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Bright colors in Ho Chi Minh City’s economic picture during the Covid-19 pandemic

08:03 | 10/05/2020

VCN- Over 45 years after the Southern liberation and national reunification, the city named after Uncle Ho has been active and creative, along with the whole country in terms of socio-economic development and national construction. This year, facing economic difficulties due tothe Covid-19 pandemic, HCMC has made efforts to overcome challenges, promote socio-economic development to attract investment and export goods.

bright colors in ho chi minh citys economic picture during the covid 19 pandemic HCM City enjoys remarkable progress 45 years after liberation
bright colors in ho chi minh citys economic picture during the covid 19 pandemic Ho Chi Minh Customs Department prevents revenue losses effectively
bright colors in ho chi minh citys economic picture during the covid 19 pandemic Which items cause reduction of revenue collection for Ho Chi Minh City Customs?
bright colors in ho chi minh citys economic picture during the covid 19 pandemic
During the Covid-19 pandemic, import and export goods through seaports in Ho Chi Minh City were bustling. In the photo: Cat Lai Port, Ho Chi Minh City. Photo: ST

Miraculous export growth

As the first locality in the country to reach more than US$10 billion in the first quarter of 2020, the exports of Ho Chi Minh City grew well in April, which pushed the country's economic "leader" to overcome the Covid-19 pandemic.

bright colors in ho chi minh citys economic picture during the covid 19 pandemic
Secretary of the Ho Chi Minh City Party Committee Nguyen Thien Nhan.

As the socio-economic situation was severely affected by the Covid-19 pandemic, HCMC’s economy in the first quarter grew by 0.42% only but showed bright spots. For example, industrial production continued to grow, exports maintained a good increase. In particular, the total budget revenue decreased, but HCMC contributed 27% to the total national budget revenue.

According to the statistics of Ho Chi Minh City Customs Department, both export and import turnover of enterprises through border gates sawgood growth in April and the first quarter of 2020. Accordingly, from the beginning of 2020 to April 15, 2020, the export turnover through Ho Chi Minh City border gates reached US$15.4 billion, up 8.1% over the same period in 2019 (the same period reached US$14.26 billion).

Contributing to 16.6% of the country’s total export turnover in the first quarter, HCMC maintained the country’s leading export with avalue of US$10.5 billion, up 14.6% over the same period last year. Continuing this growth momentum, in April 2020, export goods through HCMC’s border gates continued to grow well with a fairly high export turnover. In particular, many HCMC’s key commodity groups had high export turnover. At the leading position is computers and export accessories with a turnover of US$4.78 billion (US$3,192 billion in the same period of 2019), up 49.7% compared to the same period in 2019. Followed by exported rice items, which reached 675,484 tons, worth US$807.39 million (reaching 511,410 tons, worth US$611.97 million in the same period in 2019), up 31.9% in value over the same period in 2019.

Notably, in the export sector, the non-state economic sector reached US$932.7 million, up 15.9%; the foreign-invested economic sector reached US$2,042 billion, up 5.6%. In general, most of the exports in the month increased over the previous month, of which a number of export items soared, such as rice increased by 29.1%; fishery increased by 20.4%; textile and garment increased by 18.6%; bags, wallets, suitcases increased by 16.7%; pepper increased by 16.1%; cashew nuts increased by 16%; plastic products increased by 15.7%; and wood products increased by 15.6%.

Not only export, although imported goods through HCMC’s ports in recent years decreased, they still increased over the same period the year before. According to HCMC Customs Department, the import turnover of goods in the first half of April 2020 reached US$2.68 billion, accumulated to April 15, 2020 reached US$16.71 billion, up 3.57% over the same period last year (reaching US$2.53 billion in the period of April 1, 2019 and the cumulative amount reached US$16.13 billion).

In particular, many imported goods had high turnover, such as computers and electronic products had the largest turnover with more than US$4.3 billion, up nearly 43% over the same period last year. This increase made the group of export turnover risesharply in the past four months; home appliances and components reached more than US$328 million, up more than five%; foodstuff reached nearly US$700 million, up about eight%. However, 14 other groups of imported goods with high taxes decreased, which made the budget revenue go down by more than 13% over the same period.

In recent years, HCMC has developed many arterial traffic works to connect goods circulation between the city and the Southeast provinces, the Mekong Delta and the whole country. In addition to building and expanding the inner-city roads, many strategic and regional-connected projects have been built, including the Ho Chi Minh City - Long Thanh –DauGiay and Ho Chi Minh City –TrungLuong highways, and Trans-Asia Road (National Highway 22).

HCMC is completing the country's first metro line. As planned, the city has eight metro lines with a total length of 230 km, which are national key projects. At present, route No. 1 (Ben Thanh –SuoiTien) is sprinting with the implementation of the whole project reaching more than 71%. It is expected to reach 85% by the end of 2020 and the entire project will be completed in 2021.

Stable exports in many major markets

The remarkable point is that HCMC has tried to maintain export stability in some key markets. China is still the largest export market for city enterprises with export turnover in the first three months of 2020 of US$2.15 billion, up 31.6% over the same period in 2019, accounting for 23.4% of the export proportion.

The second largest export market is the US with an export turnover of US$1.58 billion, up 5.9% over the same period and accounting for 17.2%.

Exports to Japan reached US$777.2 million, down 1.8% over the same period and accounting for 8.5% of the export proportion.

For markets where Vietnam has participated in the free trade agreements (FTAs), export value in the first three months of 2020 tended to decrease.In particular, exports to the EU market (the EVFTA) in the first three months of 2020 reached US$1,155 billion, down 8.4% over the same period, accounting for 12.6% of the city's total export turnover.

According to HCMC, in the first quarter of 2020, global economic growth declined because of the Covid-19 pandemic, and crude oil prices plummeted. Domestically, prices were partly affected by world’s gold and oil prices; the tourism industry faced difficulties due to the pandemic; and the livestock industry has not yet recovered since the African swine fever outbreak, now it is facing the risk of another influenza pandemic.

Facing these difficulties and challenges, the City Party Committee and the People's Committee of Ho Chi Minh City directed sectors and districts to focus on preventing and fighting the pandemic effectively and drastically with the spirit of “Fighting the pandemic is like fighting enemies”, ensuring objectives and tasks of socio-economic development. Thanks to many synchronous solutions, although the development targets were lower than the same period, there are bright spots. Gross regional domestic product (GRDP) is estimated to increase by 0.42% (increased by 7.64% in the same period). The index of industrial production in the first three months of 2020 reached 99.01%in comparison to the same period in 2019, down by 0.99%. The total retail sales of consumer goods and services reached VND316,909 billion, down 1.7%; the total social investment reached VND60,276 billion, down 15.7% compared to the same period (increased by 11.9% in the first quarter of 2019).

In particular, many scenarios and solutions on promoting production development, restoring the economy after the pandemichave been deployed by HCMC to each industry and level to facilitate people and businessesto promote the country’s economic "leader".

By Le Thu/ Ha Thanh