Vietnam’s EuroCham urges EU ambassadors to procure more vaccines as country battles tenfold increase in cases
- The European Chamber of Commerce has also met Vietnamese ministries and officials over accelerating the country’s slow vaccination programme
- The fourth wave has sunk EuroCham’s confidence in Vietnam’s business environment to the fourth-lowest point in the last 12 years
EuroCham chairman Alain Cany told a webinar this week that the chamber has met different ministries and other high-level party officials in the last month to discuss the acceleration of vaccinations and the logistics associated with that, among other issues. He said vaccine procurement is a “government-to-government affair” with the support of the private sector, including EuroCham.
“For instance, we have helped to connect Vietnam’s ambassadors in EU member states with potential suppliers, and emphasised that our companies are willing to pay if these vaccines can be used for their staff,” Cany said.
EuroCham is one of the biggest foreign chambers of commerce in Vietnam, with over 1,000 members, including Pfizer, AstraZeneca and major companies like Bosch and Deutsche Bank. Its members directly employ over 150,000 people, according to its website.
The fourth wave has affected 58 out of 62 provinces and cities, with the country’s economic centre, Ho Chi Minh City, emerging as the epicentre. On Friday, it began a 15-day lockdown, with many other southern localities following suit. The capital Hanoi has shut indoor restaurants, cafes and barbershops again and is testing everyone returning from virus-hit regions.
Vietnam to give Chinese vaccine priority after complaint, embassy says
Although the caseload trails behind most of its neighbours, Vietnam has remained at the bottom of Southeast Asia’s vaccination rate for months, with less than 1 per cent of the population fully vaccinated, according to Our World in Data, mostly due to a lack of vaccine supplies.It has been receiving millions of donated doses from countries such as Australia, Japan and the US, while also trying to procure vaccines through commercial contracts and the World Health Organization’s Covax Facility. Vietnam aims to vaccinate 70 per cent of its population by next April.
On Wednesday, Pfizer said it will provide an additional 20 million doses to the country, which the health ministry said would be used for 12-18 year olds.
Business confidence
The fourth wave has sunk EuroCham’s confidence in Vietnam’s business environment to the fourth-lowest point in the last 12 years, according to its latest Business Climate Index report. Since 2010, the index has tracked the performance of EuroCham’s corporate members and their perceptions of the economic outlook in Vietnam every quarter with a total score of 100.
The second quarter was the fourth time the index had dipped below 50, to 45.8 points – a significant drop from 73.9 points in the first quarter. The group’s most pessimistic economic outlook for Vietnam was registered at 26.7 points when the first Covid-19 social distancing measures were imposed early last year, the report released on Monday shows.
‘Zero-Covid’ economies face tough question: how many deaths are acceptable?
Of the 430 members who responded to the survey, almost 60 per cent said their companies would see a major and negative impact if their staff could not be inoculated within this year.
Meanwhile, almost all of them said they would be willing to pay for the doses given to their staff, while more than half said they would also cover the family members of their employees.
The members also expressed a strong preference for Western vaccines, with just 15 per cent saying they were prepared to take Chinese or Russian vaccines.
Export hub
The chamber’s vaccination urgency reflects the severity of the current situation in Vietnam, an increasingly important manufacturing hub in Southeast Asia.
Thanks to aggressive exports, Vietnam reported 5.6 per cent GDP growth in the first six months, compared to 1.8 per cent year-on-year, according to the General Statistics Office. Besides increased exports to the US, shipments of garments, shoes and other items to Europe also rose thanks to Vietnam’s free trade agreement with the European Union, which took effect in 2020. GSO figures show value added output in the manufacturing sector increased by 11.45 per cent in the second quarter, the same period the fourth wave hit Vietnam.
E-commerce giants eye Vietnam’s booming online market
Vietnam is one of only two Asian economies, besides China, to have grown last year. Vietnam also signed a bilateral trade agreement with the United Kingdom which took effect at the end of 2020, before Britain left the EU.
As of June, the Netherlands, the UK, France, Germany, Luxembourg and Switzerland are among the top 20 investors with the most accumulated foreign direct investment in Vietnam, according to the Ministry of Planning and Investment. They trail after the top five Asian investors in Vietnam – South Korea, Japan, Singapore, Taiwan, and Hong Kong. Mainland China is number seven.
Unemployment
Almost 1.2 million people of working age lost their jobs in the second quarter, according to government statistics. Young people between 15 and 24 were disproportionately affected, comprising over a third of the jobless. Informal employment, which makes up nearly half of employment in urban areas and over 64 per cent in rural areas, rose 0.3 per cent from the previous quarter.
“The Covid-19 epidemic that has broken out in a number of localities across the country since the end of April with complicated and unpredictable developments has posed many challenges and risks for our country in realising the dual goal of disease prevention and economic development,” the GSO office said last week.
