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| Minister of Foreign Affairs Bui Thanh Son speaks at a working session with the Standing Committee of the Quang Ninh Provincial Party Committee on international integration and local foreign affairs, March 2023. (Photo: Tuan Anh) |
Promoting the mobilization of resources for green development, digital transformation; connecting support for localities and businesses... are tasks that economic diplomacy needs to actively implement in the context of many fluctuations in the world economy.
At the seminar "Some notable developments and trends of the world economy, impact on Vietnam and implementation of economic cooperation" held on the morning of May 16 in Hanoi, Assistant Minister of Foreign Affairs Nguyen Minh Hang assessed that the world economy in 2023 is forecast to continue to grow slowly, with opportunities and challenges intertwined, but the challenges are somewhat prominent.
New trends of the world economy
Many organizations and economic experts believe that "the world is at a turning point" or warn that the global economy is falling into a "lost decade".
In that context, according to Assistant Minister Nguyen Minh Hang, the acceleration of countries' implementation and legalization of new standards and criteria on international trade and investment associated with the digital transformation and green transformation processes such as the Cross-Border Carbon Adjustment Mechanism (CBAM), the EU Deforestation Reduction Act (EUDR), the global minimum tax, etc. raises unprecedented issues and has a profound impact on developing countries, including Vietnam.
Sharing the same view, Dr. Can Van Luc, chief economist of BIDV Bank, said that the world economy is forecast to grow more slowly this year, increasing the possibility of a recession in the short term.
The situation of high inflation continues to persist in many countries; strategic and geopolitical competition among major countries; the Russia-Ukraine conflict and policy adjustments by major countries pose risks to the stability of financial and monetary markets, energy security, food security and regional and global geopolitical issues... which tend to become more complex, irregular and difficult to predict.
In the new period, the expert pointed out: “The world's main economic trends include: uneven recovery speed, increased uncertainty; globalization, changing economic linkages; strategic competition, increased role of the Government; restructuring of supply chains, investment and labor; changes in fiscal and monetary policies; increased financial risks; catalyzing digital transformation; climate change, faster population aging; green economic recovery and development; changing lifestyles, investment and consumption behaviors”.
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| Overview of the Seminar “Some notable developments and trends of the world economy, impacts on Vietnam and implementation of NGKT work”. (Photo: Quang Hoa) |
Opportunities and challenges for Vietnam
New world trends will partly influence and impact Vietnam's economy.
Regarding risks and challenges, according to Dr. Can Van Luc, the slight recession of the world economy has caused Vietnam's export and investment markets to shrink; international tourism has recovered slowly, inflation is high, causing economic growth to slow down. At the same time, interest rates at major banks in the world have decreased but remain high. Risks in the international financial and monetary markets have negatively impacted Vietnam.
In addition, businesses still face many difficulties; economic restructuring, institutional reform, and administrative procedures are still slow; strategic competition among major countries; political and economic linkages are changing; protectionism and trade defense are increasing; cyber security and non-traditional security risks are increasing; Vietnam's capacity for self-reliance, self-reliance, self-reliance, and resilience is still low.
However, in danger there is opportunity, Dr. Can Van Luc realized that Vietnam will be able to take advantage of certain opportunities.
For example, China's reopening helps Vietnam export consumer goods to a market of more than 1.4 billion people; opportunities to welcome supply chain shifts and investment flows; the 2022-2023 socio-economic recovery and development program and public investment are boosted; service and consumption growth remain positive.
At the same time, Vietnam's macroeconomic foundation and experience in preventing and combating Covid-19 and managing risks have been improved; fiscal risks are at an average level, and policy space remains. Domestic inflation has gradually decreased and is under control; interest rates are decreasing; the stock and real estate markets are showing signs of recovery.
In addition, digital economy, green economy, circular economy, and energy transition are promoted. Economic restructuring and institutional improvement are promoted (amending the land law, housing law, real estate business law, electronic transaction law, price law, etc.).
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| Assistant Minister Nguyen Minh Hang delivered the opening speech at the seminar. (Photo: Quang Hoa) |
Solving the "problem" of NGKT
Assistant Minister Nguyen Minh Hang said that in recent times, the Ministry of Foreign Affairs has proactively and positively implemented the work of NGKT, closely following the Government's directions and management and domestic needs, promptly shifting the focus to the recovery and development of the country's socio-economy.
Dr. Can Van Luc realized that the work of NGKT has been implemented comprehensively, extensively, effectively, and substantially by the Vietnamese Government, with many outstanding activities.
The Government implements the Socio-Economic Development Strategy for the 2021-2030 period; issues fiscal policies (delaying and reducing taxes and fees) and monetary policies (reducing interest rates, allowing debt restructuring) to support people and businesses affected by the decline in business and income; issues many policies to remove difficulties and obstacles for the real estate market and capital market.
At the same time, the Government regularly organizes meetings with foreign investors to listen and find solutions to remove barriers; continues to improve the investment and business environment; supports businesses in diversifying export markets, promoting digital transformation, circular economy, and energy conversion; stabilizes the macro economy and financial markets, accelerates institutional improvement, and issues the Foreign Investment Strategy for the 2021-2030 period.
However, in the context of the volatile world economy, to promote the effective implementation of NGKT work to meet the Government's expectations, Dr. Can Van Luc commented that diplomatic officers need to strengthen information, research, consulting and support to promote growth drivers, taking advantage of opportunities for the country to develop quickly and sustainably.
In the long term, Vietnam's foreign trade work needs to be strengthened towards minimizing external impacts; taking advantage of opportunities from free trade agreements that Vietnam has; proactively grasping and exploiting trends.
The Chief Economist of BIDV Bank emphasized: “It is necessary to strengthen connections and support businesses and localities to diversify markets, partners, products and services; mobilize resources to serve 'green' development, digital transformation and sustainable growth; independence, autonomy and self-reliance associated with integration and enhancing the resilience of the economy”.
Only then, according to Dr. Can Van Luc, can the work of NGKT achieve substantive results, contribute to the country's development, realize the goals and aspirations set forth by the 13th National Party Congress, and contribute to the effective implementation of the Government's Action Program to implement Directive No. 15-CT/TW dated August 10, 2022 of the Secretariat on NGKT work to serve the country's development by 2030.
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