report topic the effects of coronavirus pandemic to vietnams economy

The COVID-19outbreak has severely impacted the social-economic sector of the whole world,including Vietnam, and disrupted some supply chains of input materials as wellas the consumption

TON DUC THANG UNIVERSITY

FACULTY OF BUSINESS ADMINISTRATION

GROUP MEMBERSubject: Macroeconomics

I IMPACT OF COVID-19 PANDEMIC ON CONSUMPTION IN VIETNAM 4

I.1 Modern consumption trends 5

I.2 Reduce the frequency of going out shopping 5

I.3 Consumption trends and shopping preferences 5

I.4 Changing business models to adapt to new consumer trends 7

I.5 Conclusion: 12

II VIETNAM’S IMPORT AND EXPORT IN THE CONTEXT OF COVID-19 PANDEMIC 14

II.1 Set the problem: 14

II.2 Import and export situation of Vietnam before and after the COVID-19 pandemic 15

II.2.1 Import and export situation before the pandemic 15

II.2.2 Import and export of Vietnam since the pandemic appeared 17

II.3 Some proposed solutions 22

II.4 Conclusion 23

III IMPACT OF COVID 19 PANDEMIC ON PROSPECTS FOREIGN INVESTMENT TO VIETNAM’S ECONOMY 25

III.1 Definition of foreign investment in Vietnam 25

III.2 Status Quo of foreign investment in Vietnam in COVID 19 pandemic 26

III.2.1 Prospect of Vietnam’s FDI in 2021 26

III.2.2 Foreign investors keep trust in Vietnam’s recovery 28

IV REFERENCES 31

I.IMPACT OF COVID-19 PANDEMIC ONCONSUMPTION IN VIETNAM

- As can be seen, the COVID-19 pandemic has driven planned, targetedprocurement and shifted to sustainable, rational consumption The COVID-19outbreak has severely impacted the social-economic sector of the whole world,including Vietnam, and disrupted some supply chains of input materials as wellas the consumption of product output of enterprises, which has a major impacton habits, which has a major impact on habits and consumer shoppingbehavior.

- The COVID-19 pandemic, with its complex and difficult-to-control hasseverely affected all global economies

- These have a major impact, causing a world economic crisis, profoundlychanging the order, economic structure, mode of governance, and the way theeconomy operates; changing the organization of global social life, most clearlyexpressed in modern consumption trends.

I.1 Modern consumption trends

- A weakened macroeconomic scenario, unstable employment and fallinghousehold incomes will force consumers to re-evaluate their values andpriorities as well as embrace new consumption habits Consumer confidencedeclines along with inadequate finances, leading to savings to spend morecarefully, setting aside a plan that arises for the unforeseen It can be seen thatthe pandemic has promoted planned, targeted procurement and moved tosustainable, reasonable consumption.

I.2 Reduce the frequency of going out shopping

- Surveys by market research companies show that consumer demand and behaviorhave changed much over the past year, since the Covid-19 outbreak The vastmajority of consumers aim for a healthy lifestyle, prioritizing the choice ofessential items (especially food), products that help health care, increaseresistance, Data of the General Statistics Office also showed that in the firstmonths of the year, the demand for food items increased by 4.51% compared tothe previous year, food items increased by 12.28% compared to the previous year,of which pork prices increased by 57.23%, and the price of medicines and medicalequipment increased by 1.35%.Shopping behavior also changes, outside shoppingactivities such as supermarkets, stores or traditional markets are minimized byconsumers; instead it's a tendency to strengthen and focus more on what can bedone at home.

I.3 Consumption trends and shopping preferences

- The first choices are food and medical products Consumers are moreinterested in medical products because these items are important factors inprotecting health and maintaining life in the face of the spreading epidemicwith more dangerous variations The psychology of the people, since knowingthe danger of corona, the habit of going to the market has also changed Instead

of going daily to buy fresh food, many people accept to go to the market to buystored food for many days.

- According to the Food and Agriculture Organization of the United NationsFood and Agriculture Organization's World Price Index (FAO), the price indexof food items in May 2021 was 4.8% higher than in April 2021 and 39.7%higher than the same period last year as the price of oil, sugar and grain alongwith the price of meat and milk continued to rise.

- In terms of convenience, measures such as distancing, limiting contact and soforth, making mobile, technology, and delivery orders where consumers canconveniently pick up goods help consumers buy the products they need at atime when they want to be more convenient than ever Activities such as work,shopping, entertainment, etc are still done without moving to multiplelocations.

- In addition, to meet the shopping and consumption needs of people in Ho ChiMinh City, most commercial centers, supermarket systems, chain stores, etchave cooperated with domestic and foreign brands and brands to implementpromotions and discounts of up to 50% These units also carry out a rich formof consumer stimulus such as buying 1 get 1 free; give coupons for the nextinvoice, default face value vouchers, combo sales that include the main productwith gifts.

-Although shopping directly in shopping centers, the discount is equivalent to ordecreases more than online shopping, so many consumers in Ho Chi Minh Cityare quite excited Many promotional and discounted items are products ofsome well-known brands and brands that should create favorable conditions forconsumers to shop in the context of income affected by COVID-19.

I.4 Changing business models to adapt to new consumer trends

COVID-19 has affected almost every aspect of consumers' personal lives, forcingbusinesses to also be innovative and responsive to adapt to new consumer trendsand ways of consumption

Accordingly, changing business models, from production to distribution,transportation and consumption, is the best solution to help businesses develop inthe new situation.

- E-commerce development:

+ The COVID-19 pandemic is a nightmare for many economic sectorsaround the world, but it seems to be the "fortune" of e-commerce sites,as online shopping is the only way to get what consumers need in timesof social distancing.

+ Changing in traditional buying habits, social distancing due to theCOVID-19 pandemic has changed longstanding habits, prompting evenolder adults and consumers who are loyal to traditional ways of buyingto consider shopping online.

+ With the emergence of a series of domestic and cross-border commerce platform websites and applications such as Shopee, Lazada,Tiki, customers can easily shop for everything from groceries,electronics, to educational services and hotel bookings with just oneclick or simple operations on smart mobile devices and it is importantthat at a very affordable price.

e-+ Due to the highly infectious COVID-19 virus and the convenience ofonline delivery and ordering, contactless goods trading servicesincreased sharply According to a survey by U.S market research firmForrester, in 2020, 58% of consumers chose to spend online, up 12%from pre-pandemic levels.

+ According to U.S financial advisory firm LBMC, many industries arenegatively affected by COVID-19, with some industries such astechnology and professional services less affected by meeting modernconsumer demand.

+ It is clear that the e-commerce industry is increasingly bringing moreand more motivation to the economic recovery that has been severelyaffected by the COVID-19 pandemic According to a report released byLazada, the leading e-commerce platform in Southeast Asia, 52% ofsellers in Indonesia, the Philippines, Thailand, Vietnam, Malaysia andSingapore achieved high revenue growth in the first half of 2021, while70% expect that revenue growth will continue to be increased by 10% inthe third quarter of 2021.

In fact, e-commerce platforms have contributed to opening uprich and diverse shopping opportunities for people living in smallcities, neighborhoods and rural areas, connect young consumersand live in urban areas to many international brands One featurethat makes cross-border purchases on a digital platform easier isthe presence of e-wallets, which can be used to purchase anyproduct on the platform.

- Conscious business towards smart consumption:

+ According to Worldbank, sustainability is a factor that modernconsumers are interested in when shopping 71% of consumersworldwide think climate change is just as important as COVID-19.+ Consumers are more sympathetic to responsible brands, which can

make the world cleaner Therefore, enterprises will also have to changetheir production and business models, from standard and sustainablesourcing to building a non-polluting production process, negativelyimpacting the environment.

The COVID-19 pandemic has been having a major impact on allaspects of life, negatively affecting the economy and the healthand safety of many people around the world However, thisepidemic also brings some positive effects, including consumerawareness of sustainable consumption.

According to a recent survey conducted by the IBM Institute forBusiness Value (IBV), 14,000 people from nine countries foundthe results to be of great interest: 90% of those surveyed saidcovid-19 changed their view of environmental and sustainableconsumption issues.

The willingness to change behavior also changed markedly when55% of consumers said sustainability was a very important orextremely important factor when choosing a brand 62% ofconsumers are also willing to change their purchasing behavior tominimize the negative impact on the environment.

In Vietnam, although there is no official data on transformingconsumers' perceptions of sustainable values after the emergenceof the epidemic, it can be seen that sustainable consumption is

becoming more and more concerned in the consumer communityand businesses In particular, the Event of Vietnam ConsumerRights Day 2021 with the theme "Healthy business – Sustainableconsumption in the new normal period" has strongly promotedsustainable values in business policies of businesses as well as indaily consumption of consumers.

- Application of technical technology in distribution:

+ COVID-19 disrupts supply chains, reduces customer service and causesdelivery delays.

+ Therefore, even logistics providers need to change their businessmodels Advanced technologies such as artificial intelligence (AI),blockchain and automation are being integrated into the digital supplynetwork, integrating data and information from different sources todrive the distribution of manufactured goods along the value chain.

+ Artificial Intelligence (AI) technology plays an important role inoptimizing modern supply chains For example, for warehousing goods,artificial intelligence and location can help retailers maintain acompetitive advantage over their product distribution and supply chain.Multifaceted big data from specific geographic locations combined withonline interactions can show purchasing patterns based on certain times,events, and conditions in detailed customer segments.

+ Therefore, a retailer can use AI to predict which products are more effective to stock in a given warehouse located near specific areas Orblockchain technology is a way of distributing the verification processto anything from financial transactions to logging shipping information.

cost-+ Over time, aggregated blockchain ledger information can revealweaknesses in the supply chain and help organizations continuallyoptimize operations Thus, changing the business model to meet modernconsumer needs is the most effective solution to maintain and developin the new situation globally.

I.5 Conclusion:

- The actual record shows that, although Vietnamese consumers havereduced the size of their carts in terms of the number of goods in eachgrocery shopping, the value of shopping carts has increased significantly.At the same time, people are willing to spend more per unit of goods or cartvalue per consumer purchase in daily activities.

- This trend, quite in line with the status of many families, prioritize theplanned monthly spending on processed and fresh food, canned food andother items that have increased in the past.

- In particular, with the impact of COVID-19, consumer behavior haschanged greatly, which means increasing monthly spending on health careproducts such as hand sanitizer and masks.

- In contrast, households' planned monthly spending on travel has declineddue to social distancing measures that have led people to curb their need totravel outside Similarly, people's spending on education services is alsolimited, because this is a non-essential area during the epidemic period.

Recommendations for business:

- Although Covid-19 brings many disadvantages and difficulties forbusinesses, the reality is that this is also an opportunity for businesses todevelop in a more sustainable way, towards more community values To dothat, businesses, manufacturers and distributors can refer to the followingrecommendations:

+ Use green, environmentally friendly materials in the distribution channel.+ Allow consumers to be proactive in not using plastic products when buying

from a distance.

+ Create a mechanism for consumers to continue to make purchasessustainably through a "refill" mechanism that allows consumers to bringused bottles and jars to store products.

Recommendations for consumers:

- Sustainable consumption may be a relatively new concept in Vietnam.However, this concept is not difficult to implement Although the covid-19pandemic brings many difficulties, this is also an opportunity for consumersto "sustain" daily consumption to contribute to the safety of themselves,society and for later generations, such as:

+ Use multi-compartment cloth bags and containers to go to the market, go tothe supermarket, to limit the use of plastic bags.

+ Use eco-friendly straws instead of plastic straws such as bamboo straws,grass, metal, paper

+ Bring personal water bottles to buy drinks to minimize plastic cups.

+ Increase the consumption of local products, the season foods, vegetables,fruits and so forth to minimize the environmental harm caused bytransportation from far away as well as ensure the health of consumers.+ Actively respond to the business activities of enterprises towards

sustainable consumption such as: bringing bottles and jars to buy products(the form of "refill" as above), choosing not to take plastic eating utensilswhen buying online, choosing to buy from stores using green materials inthe distribution channel such as paper bags, banana leaves wrappedvegetables

OF COVID-19 PANDEMIC

- The COVID-19 pandemic has negatively impacted global trade, affectedsupply chains and led to import and export activities of many countries,including Vietnam Studying the situation of Vietnam's import and export inthe period before the pandemic (2015-2019) and until the pandemic (from thebeginning of 2020 to the present), the article identified the impacts of theCOVID-19 pandemic on Vietnam's import and export, thereby proposingsolutions to contribute to promoting import and export activities in our countryin the coming time.

II.1 Set the problem:

- In recent years, Vietnam's import and export of goods has changed drastically,becoming an important driver for economic growth

- Import and export activities help increase foreign currency reserves, improvethe balance of payments, increase revenues for the State budget, stimulatetechnological innovation, access to new forms of business, create more jobs,create competition between domestic and foreign goods, improving people's

living standard, contributing to shortening Vietnam's economic gap withdeveloped countries in the world It is expected that in the coming time, importand export activities will continue to flourish

- The fact that free trade agreements (FTAs) are gradually being implementedmore comprehensively and effectively will facilitate Vietnamese goods to enterpotential markets with preferential tariffs

- In addition, the price of exported goods is on the rise, especially vietnam'sstrong commodities, which is an important motivation to increase the value ofVietnam's exports

- However, import and export activities are also being affected by many newfactors such as the COVID-19 pandemic, trade protectionism trends, globalsupply chain fractures This fact sets the requirement that Vietnam needsmore solutions to overcome difficulties and challenges and take advantage ofnew opportunities.

II.2 Import and export situation of Vietnam before and after the COVID-19 pandemic

II.2.1 Import and export situation before the pandemic

- According to the General Department of Customs, the total import and exportturnover of goods in 2015 reached 327.76 billion USD, an increase of 10%compared to 2014; of which, goods exports reached 162.11 billion USD, up7.9% over the same period in 2014 and imports of goods were 165.65 billionUSD, up 12% over the same period in 2014.

- The country's merchandise trade balance had a deficit of 3.54 billion USD(equivalent to about 2.2% of the country's merchandise export turnover) and viceversa compared with the surplus trend of 2.37 billion USD in 2014 In 2016,

176.63 billion USD, up 9% (equivalent to nearly 14.52 billion USD) compared to2015; imports reached more than 174.11 billion USD, an increase of 5.2%(equivalent to 8.46 billion USD) compared to 2015 In particular, 2016 was alsothe year Vietnam achieved a high export surplus rate, at 2.52 billion USD - In 2017, the total import-export value continued to increase, reaching USD 425.12

billion, up 21% (equivalent to about USD 73.74 billion) compared to 2016 Inwhich, the total export value reached USD 214.02 billion , an increase of 21.2%