Vietnam posts record GDP slump in Q3

Vietnam's gross domestic product contracted 6.17 per cent in the third quarter of 2021 from a year earlier as pandemic restrictions hit, the sharpest quarterly decline on record, government data released on Wednesday showed.

The services sector contracted 9.28 per cent from a year earlier in the period, while the industrial and construction sector fell 5.02 per cent, the General Statistics Office (GSO) said in a statement. The agriculture sector expanded 1.04 per cent.

"The COVID-19 pandemic has seriously affected all aspects of the economy with many key production cities and provinces having to impose strict lockdowns," the GSO said in a statement.

The GSO traditionally releases data before the end of the reporting period and its data is often subject to revision. Growth in the second quarter was revised down to 6.57 per cent from 6.61 per cent.

After successfully containing the virus for most of last year, Vietnam has been grappling with a rise in infections since April, with total cases at 770,000 and 18,936 deaths, mostly in its business hub Ho Chi Minh City and neighbouring industrial provinces.

The outbreak has forced authorities to impose strict lockdowns in Vietnam's largest cities and provinces, and prompted companies to suspend production.

The government has in the past week taken steps to gradually ease lockdowns, following pressure from business associations and warnings by investors that the restrictions will prompt a shift away from the country.

The government is targeting a 6.5 per cent GDP increase this year, but a minister earlier this month said growth could be 3.5 per cent-4.0 per cent.