Hanoi GRDP up 5.8 percent in Q1

Hanoi focuses on pressing investors and construction units to increase resources and speed up construction progress of important projects

In March 2023, the Index of Industrial Production (IIP) increased by 5.9 percent over the previous month and by 2.9 percent over the same period in 2022. However, the IIP rose by only 0.8 percent in the first quarter of 2023, which is a relatively low increase compared to recent years. Increases were recorded in the production of beverages, wood processing and wood products, drugs, pharmaceutical chemicals and medicinal materials, metal products, and tobacco products. Conversely, industries such as printing, copying records of all kinds, metal production, production of rubber and plastic products, apparel production, and production of electrical equipment experienced a decline in the IIP index.

Hanoi focused on pressing investors and construction units to increase resources and speed up construction progress of important projects during the first quarter of 2023, which led to an increase of 8.6 percent in development investment capital compared to the same period last year. In order to support the expansion of commerce and services, the city also stabilized prices by supplying sufficient commodities before, during, and after Tet (the Lunar New Year Holiday), and balancing the supply and demand of petroleum. Nonetheless, Hanoi's most important import and export markets recorded turnover decline.

The total retail sales of consumer goods and services increased by 12.6 percent in the first quarter of 2023 compared to the same period in 2022. The survey on production and business trends of enterprises in the processing and manufacturing industry in the first quarter of 2023 showed that 21.6 percent of enterprises rated their production and business situation better than in the fourth quarter of 2022. Additionally, 38.4 percent of enterprises stated that their production and business situation was stable, while 40 percent reported difficulties. Looking forward, 33.4 percent of enterprises predicted improved second quarter results, while 45.2 percent believed that the production and business situation would remain stable, and 21.4 percent forecast growing difficulties.

A concerted effort is required to improve investment, business, administrative reform, and competitiveness over the remaining nine months of the year in order to successfully meet the socioeconomic development goals and targets for 2023. This may be accomplished by carefully examining and swiftly addressing any issues that firms may be having, as well as by putting policies in place to support their operational and production operations. Such measures could include providing loans at preferential interest rates, tax and credit incentives, and improving access to land and human resources. It is also important to encourage the application of high technology, digital transformation, and the production, processing, and consumption of agricultural products.

Producing household appliances at the factory of Sunhouse Group (Ngoc Liep Industrial Park, Hanoi’s Quoc Oai District)

Emphasis should also be placed on enhancing home consumption, establishing Vietnamese brands, and using and expanding the domestic market. To properly implement the campaign “Buy Vietnamese Goods”, it is crucial to develop consumer demand stimulation initiatives. To hasten the recovery and expansion of tourism in the capital, structured promotional activities should be paired with marketing.

Industrial output should be accelerated in line with the city’s Program for the Development of Key Industrial Products, the Program for the Development of Supporting Industries, and the Program for the Development of Priority Industries. Consolidating and improving the production capacity of firms in industrial zones and clusters is also critical, as is encouraging investment in infrastructure, manufacturing, and businesses in industrial zones and clusters.

Synchronous, radical, urgent, and more effective solutions are urgently required to speed up the distribution of public investment, as well as to mobilize private capital for development investment. Priority should be given to accelerating the implementation of significant projects, such as traffic infrastructure, infrastructure of industrial parks, industrial clusters, traditional craft villages, and social housing.