The country's economic growth was recorded at 4.5% during the last quarter of 2020, representing an annual growth rate of 2.9%, thereby making it one of the fastest growing economies in the world, according to the World Bank (WB).

In the January edition of its monthly Vietnam Macro Monitoring, the WB outlined how the nation’s industrial production and retail sales continued to expand solidly, with growth rates already close to pre-pandemic levels.

Furthermore, December, 2020, marked another strong performance for merchandise trade, with double digit growth rate recorded in imports at 23.1% and exports at 17.8%, although FDI inflows began to show signs of slowing.

In addition, the consumer price index remained flat during this period as food prices stabilised, although consumer demand has yet to fully recover from the crisis.

Credit growth also slightly picked up after the State Bank of Vietnam moved to cut policy interest rates in October, 2020, thereby ending last year at a rate of 10.1%.

Auctions and the granting of land use and rental improved revenue collection during the last quarter of 2020, while ample liquidity continued to lower the Government’s borrowing costs in relation to the domestic market.

The approval and rollout of several novel coronavirus (COVID-19) vaccines at the end of last year also boosted the outlook of domestic and global economies ahead in 2021, particularly in relation to tourism and airlines.

Moving forward, the Government must carefully assess when to unwind macroeconomic policies launched in response to the COVID-19 crisis in order to minimise the negative impact on the economy, the bank stressed.