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Ho Chi Minh City
Sunday, October 24, 2021

HCMC’s growth lower than half of country’s GDP growth

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HCMC – HCMC’s gross regional domestic product (GRDP) in 2020 is estimated to grow 1.39% over last year, lower than half of the country’s gross domestic product (GDP) growth of 2.91%.

At a press briefing on December 29 to announce the city’s socioeconomic performance in 2020, Huynh Van Hung, head of the HCMC Statistics Department, said the growth rate was also much lower than the rate of 7.83% last year.

Specifically, the agro-forestry-fishery sector posted a growth of 2.06%, industry and construction, 0.43% and trade and services, 2.17%.

Hung said the growth of the trade and service sector was the lowest in the past decade due to the severe impact of Covid-19.

The added value of nine key services in the city accounted for 56.7% of the city’s GRDP and 90.9% of the service sector. Of these, four services with the highest proportions were trade (15.7%), transport and storage (9.6%), science and technology (5.2%) and finance-banking (8.7%).

Meanwhile, the total retail sales of goods and services edged down 1.3% to VND1.22 quadrillion (US$51.8 billion). The tourism sector registered the largest reduction of 76.7%, followed by lodging and catering services, with a drop of 33.8%.

The industry sector expanded just 0.47% and would find it hard to rebound to the 7%-7.5% before the pandemic.

As the city has issued many support policies, such as those to reduce and exempt taxes and fees, its budget revenue fell 14.2% to VND352 trillion—VND238 trillion from domestic production and business activities, VND10.5 trillion from crude oil and VND103.5 from import and export activities—down 11.4%, 52.2% and 12.8%, respectively.

The city had to cut 10% of its fund for districts, while the demand for capital to invest in infrastructure projects was high, Hung added.

In addition, the city’s consumer price index expanded 2.78%.

Incurring trade deficit

According to the HCMC Statistics Department, the city exported products worth over US$40.2 billion, including crude oil, in 2020, up 1.3% year-on-year, and spent nearly US$43.4 billion on imports, inching down 1.6%, resulting in a trade deficit of some US$3.15 billion.

The city had five groups of products with an export revenue of over US$1 billion each, accounting for 83.5% of the total export revenue, of which computers, electronic products and accessories took the lead with US$17.8 billion, followed by textiles and garments with US$4.3 billion.

As for imports, eight kinds of merchandise reported an import bill of over US$1 billion each. Computers, electronic products and accessories posted the highest import expenditure of US$16.5 billion, making up 38% of the city’s total import value and increasing 23.9% over last year.

They were followed by other products with US$9.5 billion; machine, equipment, tools and machine parts with US$4.7 billion and fabrics with US$1.7 billion.

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