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14 COVER STORIES 20 COVER STORIES
CONTRIBUTING 14% OF GDP, Finding capital For

REAL ESTATE MARKET STILL real estate

NOT A DRIVER When credit was previously restricted, many real estate businesses

turned to capital market channels such as bonds and stocks. As
According to the Vietnam National Real Estate Association management agencies take a series of drastic steps, these channels
(VNREA), the real estate market has an influence on more than are also gradually narrowing. Analysts say that real estate
40 other important sectors of the economy and contributes to the businesses must be more active in introducing their own
development of different types of markets. Although potential capabilities to access capital channels.
remains for its development and for it to play a role as a driver of
the economy, Vietnam’s real estate sector faces many barriers.
Specifically, besides the impact of Covid-19, legal problems have
resulted in many projects being delayed. Businesses are not
only struggling with capital but have also had to incur
many costs in both time and capital. The Ministry of
Construction has offered suggestions and solutions to
strengthen management, remove difficulties, and create
favorable conditions for the development of the real
estate market.

8 ECONOMY & POLICY

PRODUCTION RECOVERS,
BUSINESS CONFIDENCE RISES AGAIN

Industrial production in the first four months of the year
recovered in most industries, demand and production
output increased, businesses resumed operations, and basic
supply chains functioned smoothly. According to IHS
Markit, business confidence increased at the beginning of
the second quarter and was above the index’s historic
22 COVER STORIES average. The recent improvement in the situation
surrounding the pandemic in Vietnam and expectations
IDENTIFYING SOLUTIONS that it will be brought under control has been cited as a
cause for positive expectations, while businesses also expect
FOR REAL ESTATE TO BOOST demand to strengthen and supply constraints to ease.
However, in some industries, due to a scarcity of raw
ECONOMIC DEVELOPMENT materials, high prices have restrained the increase of
production output. Forecasting industrial production
It is estimated that real estate contributes some 8 per cent of GDP activities in the future, the Ministry of Industry and Trade
each year, but its development in Vietnam has not been expects that it will continue to prosper.
commensurate with the needs and size of the economy. In the
current circumstances, if the real estate market is not supported
in a timely manner and if there is no regulation or scientific
management, there will be negative consequences for the entire
economy. Therefore, the Ministry of Construction has proposed
four solutions to promote the role of the real estate market.

4 Kinh tế Việt nam | số 19 | ngày 9/5/2022 www.vneconomy.vn