Business confidence and Vietnam’s post-coronavirus economic recovery

Monday, 2020-05-11 12:20:30
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If the business circles have confidence, economic recovery will definitely be accelerated.
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NDO - The economy of a nation or a region is always subject to a variety of factors. If an economy is equated with a mathematical function, such a function would be composed of several variables such as macroeconomic policy, market supply-demand, labour and technology.

In that function, business confidence is also a variable, which is hard to quantify but important to the whole economy. During the past several months of combating the coronavirus outbreak, the public have placed complete confidence in the Vietnamese government’s response in the spirit of “fighting the epidemic is like fighting the enemy”.

Today, Vietnam is, to a certain degree, on the winning side of the epidemic but a bumpy road lies ahead, with the challenge of reviving the economy which was hurt by the coronavirus. On this journey, if the business circles have confidence, economic recovery will definitely be accelerated.

The government has made many important policy decisions and now is the time to enact such policies quickly from the central to local levels. Within that process, the role of local governments is very important because if they are disobedient to the higher levels, businesses will find it hard to place confidence in the government.

Instead of implementing policies by prohibiting activities difficult to keep under control, governments at all levels should accompany enterprises and promote any businesses that can return to normality while taking coronavirus prevention measures.

Curbing the outbreak is hard but curbing the outbreak while keeping the economy going is even harder. It is the litmus test for the capacity of governments at all levels to build confidence of the business community and the public in general.

For instance, amid huge concerns over the coronavirus in the last few months, the factories of Pouyuen, one of the largest employers in Ho Chi Minh City with 72,000 workers, have largely remained in operation, having shut for only two days, which was a great success, especially as no cases were reported in the company.

Not only is this success significant to this particular enterprise but it creates confidence for foreign investors in Vietnam’s method of curbing the outbreak. The government can replicate this example by providing enterprises with the best conditions possible.

That is the way to build up confidence and to make the government’s policies be soon embraced by the business community. When they have confidence, although they may not receive all the financial support as requested, businesses are still motivated to look for creative avenues towards a quick economic recovery.