Hanoi’s strong economic performance during the first eight months of 2022 has created momentum for the city to further push for growth in the subsequent months and realize the year’s target.

Production at Rang Dong Company. File photo

Data from Hanoi’s Statistics Office revealed the city’s index of industrial production (IIP) in August expanded by 0.9% month-on-month and 15.7% year-on-year. Of which, the manufacturing and processing sector, accounting for 96.5% of total production value in the industry sector, grew by 16.8% year on year.

For the eight months, Hanoi’s IIP growth stood at 8.3% year-on-year, higher than the 6.3% rate recorded in the same period last year.

The positive performance of the local economy has also been reflected in the recovery of trade, services, and tourism activities.

Total revenue from retail sales and services in the eight months was estimated at VND451.3 trillion (US$19.2 billion), up 29% year-on-year, while the number of tourists coming to Hanoi reached 1.4 million, representing a 2.2-fold-increase and surpassed the target for this year.

Hanoi’s exports climbed by 32.4% interannually to $11.1 billion, and budget revenue hit VND223.1 trillion ($9.5 billion), or 71.6% of the estimate and up 10.5% year-on-year.

Amid rising concern over inflationary pressure worldwide, Hanoi’s consumer price index (CPI) growth in August slightly decreased by 0.1% inter-monthly.

This put the eight-month CPI at an expansion rate of 3.37% year-on-year, lower than the year’s target of 4%.

A report from the municipal Department of Planning and Investment suggested the firm recovery of Hanoi’s economy was thanks to the Government’s support policies and the authorities’ efforts in stabilizing prices of strategic commodities, containing inflation and ensuring sufficient supplies of essential goods.

Meanwhile, Hanoi’s Department of Industry and Trade noted in 2022, the agency would hold 30 trade promotion events to stimulate domestic consumption and address concerns of local traders, including sales promotion of up to 100% of   discounts on price since April; online trade fair; and business match-making events with foreign partners.

The bright outlook of Hanoi’s economy has also caught the attention of foreign investors, as the city attracted over $992 million of FDI commitments, up 49.6% year-on-year. These included 226 fresh projects with registered capital of $141.3 million, up 19.4% and 122 existing projects being pumped additional funds of $374.6 million, up 16%.

Hanoi issued business licenses for over 20,000 new companies with registered capital of VND226 trillion ($9.6 billion), up 22% in the number of enterprises and 2% in value.

For the eight months, the disbursed amount of public investment fund reached VND28 trillion ($1.2 billion), up 8.5% year-on-year or 54.7% of the year’s estimate.

This year, Hanoi targets to fully disburse the public investment funds, seen as a key task for socio-economic recovery.

At present, the city is accelerating the construction of the elevated Ring-road No.2, to ensure its completion in 2023; disbursing  51.1% of the funds allocated for  Vinh Tuy Bridge Phase 2 project to ensure its  completion as scheduled in June 2023.The Hanoi Children's Palace workload is 38.7% complete so far, and the Palace is on track to be completed by 2024. The Le Van Luong underpass, one of the city's six key transportation projects, is expected to open in October 2022.

Improving business environment

Despite positive results, the city has anticipated rising challenges for the remainder of the year, including uncertainties surrounding the Covid-19 pandemic situation; scarce supplies of input materials for industrial sectors; and high inflationary pressure.

To ensure the economic recovery efforts, Hanoi would continue to address the concerns of businesses and people affected by the pandemic, including a provision of a total of VND6.6 trillion ($281 million) in preferential loans via the Vietnam Bank for Social Policies.

The authorities plan to ensure effective implementation of the support program for small and medium enterprises in the city for the 2021-2025 period, a program to aid startups in 2019-2025; and the digitalization program for local businesses from 2021-2025.

Chairman of the Hanoi People’s Committee Tran Sy Thanh said the city gives priority to administrative reform, improving the business environment, and enhancing economic competitiveness.

“Hanoi would continue to push for digitalization toward the formation of digital government and development of smart cities,” Thanh said.