China’s Border Re-Opening: A Positive Variable For Vietnam?
China is forecast to fully reopen in the Q2 of 2023 after three long years of implementing Zero Covid. This is considered an important event for the world as well as Vietnam when the leading economy returns to the race.
Chinese people return home after three years
Growth Of Global GDP To Increase
China is the second largest country in the world in terms of GDP, according to which the easing of the Zero Covid policy and changing the anti-epidemic method will solve the problems of the struggling economy. Speaking at the Vietnam Economic Scenario 2023 Forum on January 11, BIDV chief economist Can Van Luc predicted that global GPD would increase by 0.1% thanks to this event and Vietnam is not an exception.
Stocks Gain Benefits
After two dismal years, Asian stocks are forecast to bounce up with an average increase of about 9% after China’s economy opens. Positive forecasts are also given for Vietnam. According to BIDV Securities Company (BSC), 4 sectors are forecasted to gain benefits in 2023 including industrial real estate stock, aviation services, fishery and livestock. The authentication is based on the Vietnam-China border’s reopening on land and air, promoting export, transportation and tourism interaction, and welcoming FDI investment enterprises returns to Vietnam.
The aviation industry expects China’s international flight routes to resume and recover strongly in the first and second quarters of 2023
A Boost For Vietnam Tourism
According to a report by VinaCapital Investment Fund, the biggest impact on Vietnam’s economy will be the number of tourists gradually returning to the pre-epidemic period in the second half of 2023.
Asian tourists make great contributions to Vietnam’s tourism
Before the outbreak of the Covid-19 epidemic, Vietnam welcomed 7.5 million Chinese tourists annually, accounting for one-third of the total number of international visitors.
Aviation services, catering services, travel and accommodation are forecast to benefit greatly from this event. This is also the driving force for Vietnam’s GDP to grow by 2% next year.
It is forecasted that it will not be until the end of Q2/2023 that China’s border re-opening will really affect the global economy, including Vietnam’s agriculture, service and import-export sectors. At the same time, Vietnam will face competitive challenges between domestic Chinese enterprises. However, competition will also be a prerequisite for development.
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