Việt Nam this year has achieved a gross domestic product (GDP) growth of 2.91 percent, an impressive figure despite the impact of the COVID-19 pandemic, according to the General Statistics Office (GSO).

"This year's GDP growth rate was the lowest during the 2011-20 period due to the COVID-19 pandemic. However, Việt Nam’s growth remains among the world’s highest," GSO director-general Nguyễn Thị Hương told the press on Sunday.

Việt Nam’s growth rate being among the highest in the world is a testament to the determination of the Government as well as efforts by people and the business community to effectively realize the dual goals of pandemic prevention and economic recovery, Hương said.

Specifically, it expanded by 3.68 percent in the first quarter, 0.39 percent in the second quarter, 2.69 percent in the third quarter, and 4.48 percent in the fourth quarter.

She said many factors have created a driving force for domestic economic development in the last quarter, including strict control of COVID-19 and the EU-Việt Nam Free Trade Agreement (EVFTA) effective from August 1, contributing to GDP growth in the fourth quarter.

According to Hương, the agro-forestry-fisheries sector has grown by 2.68 percent, contributing 13.5 percent to the national GDP.

This figure has surged by 3.98 percent in the industry and construction sector, contributing 53 percent to the domestic economy.

The manufacturing and processing sector has played a key role in leading the growth of the economy with a 5.82 percent rise.

The electricity production and distribution sector has had growth of 3.92 percent, while water supply and waste treatment rose 5.51 percent. But the mining sector fell 5.62 percent.

The service sector has posted the lowest growth in nine years with 2.34 percent due to the pandemic. It saw the contributions of wholesale and retail sales (up 5.53 percent), finance-banking-insurance (up 6.87 percent), transport and logistics (down 1.88 percent) and accommodation and restaurants (down 14.68 percent).

Regarding economic structure, agro-forestry-fisheries have accounted for 14.85 per cent, industry and construction 33.72 percent, and services 41.63 percent.

The Government has set a target of securing a GDP growth rate of approximately 6 percent in 2021. It is a challenging task for Việt Nam, according to the GSO, as the Vietnamese economy’s openness is comparatively high, making it vulnerable to any market fluctuations, alongside drastic changes in the regional and global geopolitical landscape.

In addition, the COVID-19 pandemic is not over, which is expected to exert a further negative impact on all economies, including Việt Nam.

Success in inflation control

Also at the press conference, Hương said that 2020 is considered a year of success in inflation control. The 2020 consumer price index (CPI) has risen by 3.23 percent from 2019.

Of which, the CPI in December went up 0.1 percent month-on-month and 0.19 percent year-on-year.

Explaining the price hike this year, head of the GSO’s Price Statistics Department Đỗ Thị Ngọc said due to high shopping demand during the Lunar New Year (Tết) Festival from January-February, food prices increased by 4.51 percent annually, bringing up the CPI by 0.17 percent. Pork prices also moved up the CPI by 1.94 percent due to unstable supply.

Rainfall and floods in the central region during October-November also hiked prices of fresh, dried and processed vegetables.

Other increases were also seen in the prices of medical supplies and education services.

Meanwhile, falling prices in oil and gas, flight tickets and electricity due to the COVID-19 pandemic curbed the CPI rise.

According to the GSO, core inflation (CPI excluding food items, energy products and commodities under the State management like medical and educational services) this year has climbed by 2.31 percent year on year.

The core inflation dropped from 3.25 percent in January to 0.99 percent in December, which proved the efficiency of the State Bank’s monetary policy this year.