Vietnam is the only country in the world having its outlook upgraded to “positive” by three major rating agencies of Moody’s, Standard and Poor’s (S&P), and Fitch since the Covid-19 outbreak.

S&P raises Vietnam's outlook to positive. Photo: RICHARD B. LEVINE/Newscom

S&P on May 21 announced its decision to keep Vietnam’s sovereign rating unchanged while raising the outlook from “stable” to “positive”.

S&P explained a positive assessment on Vietnam’s prospect was due to the country’s impressive economic achievements and continuous regulatory reform at a time when the pandemic is causing negative impacts on socio-economic development.

Following Vietnam’s GDP growth among the highest in the world last year, S&P expected the country would continue to maintain its economy in good shape for recovery in one or two years, thanks to effective measures to contain Covid-19 situation domestically; an attractive investment destination in Southeast Asian for FDI inflows; stable trade performance; and strong domestic demand.

Meanwhile, the flexible management of fiscal policy and public debt under control have also played a part in helping Vietnam cope with the pandemic.

The pandemic has caused the global economic recession, with rating agencies dropping their ratings and outlooks last year for countries/territories by 124 and 133 times, respectively.

As of May 21, 16 countries received low ratings from Moody’s, S&P, and Fitch.

Vietnam’s Ministry of Finance (MoF) said the country remains steadfast in pursuing the goal of stabilizing macro-economic conditions, bolstering economic resilience, and pushing for institutional reform along with efforts against the pandemic.

“This would help the country create a solid foundation to realizing its mid-and long-term goals, as well as raising the rating outlook,” said the MoF.

In April, Fitch revised Vietnam's outlook to positive from stable, while affirming the Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB'.

Moody’s in March announced a similar move, saying “the drivers of the positive outlook include signs of improvements in fiscal strength and potential improvements in economic strength that may strengthen Vietnam's credit profile over time.”