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Providing appropriate response when reopening economy

Assoc. Prof. Dr. Ta Van Loi - Director of International Trade and Economics Institute(National Economics University).

The Prime Minister has directed the spirit of living with the pandemic to restore the economy, what do you think about this request?

Although countries in the world such as the US and Europe were strongly affected by the Covid-19 pandemic, they have expedited vaccination, created herd immunity and treated residents who are not healthy to recover, reducing the mortality rate.

These countries have given the first priority to economic development to respond to the pandemic, so they have provided the best solutions. Therefore, the countries have gradually reopened their economies, while Vietnam effectively prevented the pandemic in previous outbreaks, now the country is facing many difficulties.

Vietnam has focused on preventing the disease rather than treatment. The country has mobilized all resources for quarantine, testing and social distancing and then implemented vaccination programs to create herd immunity, causing supply chain disruptions, suspension of production and macroeconomic instability. Some foreign investors and partners have shifted their orders to other markets. The GDP in the third quarter plunged by 6.17% year-on-year.

Moreover, the fourth outbreak is different from the previous outbreaks, leading to difficulties in disease prevention and control as well as economic development. Therefore, we need to quickly change the method of Covid-19 prevention and economic development at a lower cost but more effective manner. I agree with the Government’s goal of living with the pandemic while ensuring economic recovery.

To achieve the goal of opening the economy and living with the pandemic, in your opinion, what overall solutions should we implement?

When following the goal of living with the pandemic, we need to consider two issues. Firstly, Vietnam has not yet produced vaccines, and the global vaccine supply faces a shortage. These solutions must be in line with the policy of achieving herd immunity and providing appropriate response if the pandemic returns.

Second, we need to focus on transforming the health system to quickly respond to the return of the pandemic. Currently, many localities have not allowed private health facilities and human resources to participate in the control of the public health crisis, leading to a shortage of healthcare resources and imbalance. If a large-scale outbreak occurs in a new place, we will not have enough resources for disease prevention. We need to implement policies of training a qualified public health workforce, and providing rapid response scenarios and processes.

What solutions should we implement for disease prevention and control?

The best solution is to understand is the spread of Covid-19 is from person to person, not to goods. Localities need to establish logistics centers to load and transport goods to meet the demand of local enterprises and residents, and control residents moving in and out these centers. All drivers and laborers must meet safety requirements such as having two doses of vaccine or testing negative during implementing business operations.

To overcome the supply chain disruption in a long term, the country should take advantage of water and sea routes and logistics. In my opinion, management agencies need to carefully think about logistics in planning and implementing the Covid-19 prevention and control strategy to meet timely financial and economic factors. The Covid-19 prevention and control strategy must be consistent with the logistics strategy.

We need the unified direction from the Government, central government agencies to local government agencies in economic management or pandemic prevention. We avoid performing difficult policies in each locality, creating barriers for economic development and goods circulation. Localities should develop effective policies to mobilize resources and replace long supply chains with short supply chains in pandemic-affected localities.

Currently, business support solutions also need to be promoted and executed effectively. Accordingly, banks should assist businesses not only on fees and charges, but also offer financial support packages, reducing loan interest rates, etc.

Businesses also need to establish a new management method in accordance with the existing principles, and provide specific criteria for businesses eligible for operation amid the pandemic. Enterprises should research, develop new raw materials, create a new supply chain to respond the pandemic and carry out long-term plans for the supply chain in the new context.