To realize the gross regional domestic product (GRDP) growth target of 7.5% for 2021, Hanoi is expected to reach a growth rate of 8.87% for the last six months of this year.

Nhat Tan Bridge in Hanoi. Photo: Pham Hung

“This means that the economic growth in the third quarter should be 8.59% and 9.12% in the fourth,” Head of the Hanoi’s Statistics Office Dau Ngoc Hung made the assessment in a meeting discussing the capital city’s economic performance in the January-June period on June 28.

This came as the fact that Hanoi’s GRDP growth in the first half of the year expanded by 5.91% year-on-year, significantly higher than the 2.92% rate recorded in the same period of last year, but lower than the six-month target of 7.19%.

“The Covid-19 pandemic has exerted negative impacts on business activities and production, especially in tourism, hospitality services, and entertainment,” said Hung, adding these sectors have witnessed a sharp plunge in revenue compared to last year.

According to Hung, the work ahead is quite challenging, which requires breakthroughs and greater contribution from key sectors, especially manufacturing and processing.

“With measures to improve the business environment and support enterprises, the industrial sector could grow as high as 10% in the final six months,” he added.

The construction sector could also a potential field to aid growth by expanding by 12% for the period, followed by wholesale, retail, and banking sectors, Hung suggested.

Another factor that Hanoi should focus on is to repopulate the pig herd and ensure a sufficient supply of basic necessities for market stabilization.

“Hanoi’s economic performance is dependent on its success of containing the Covid-19 pandemic, as well as higher efforts in disbursing public investment fund,” Hung asserted, referring to the disbursement rate at 7.03% of the plan as of May.

In the first six months of the year, the agro-forestry-fishery sector expanded by 3.09%; the industrial and construction sectors at 7.74%; and services by 5.74%.

The industrial sector has been a spotlight for the local economy as the index of industrial production (IIP) rose by 8.7% in the six-month period, a stark contrast from modest growth of 3.5% in the same period last year.

Meanwhile, state budget revenue in Hanoi climbed by 7.1% year-on-year to VND124.8 trillion (US$5.4 billion), or 53% of the year’s estimate. Hanoi also attracted 171 fresh projects worth US$96.1, while investors pumped an addition of US$477.7 million into 78 existing ones.

Trade performance has also been positive with exports rising by 4.5% year-on-year in the January-June period to US$7.16 billion.