THE IMPACT OF TYPHOON YAGI ON VIETNAM'S ECONOMY

September 2024 saw severe impacts from Typhoon Yagi, which caused significant damage to northern provinces of Vietnam, particularly Hai Phong and Quang Ninh. The typhoon resulted in flooding and destruction of infrastructure, affecting the economic activities in these areas.  

According to FiinGroup's data, the affected provinces contribute approximately 25.81% of the national GDP and host 111 industrial parks along with 4,760 foreign direct investment (FDI) enterprises operating in key sectors such as information technology, manufacturing, construction, and tourism. The estimated damage caused by the typhoon exceeds VND 40 trillion, with long-lasting effects on various industries. 

Key takeaways :  

1. Economic Damage: Typhoon Yagi caused severe damage to 26 provinces and cities in northern Vietnam, including key economic zones like Hai Phong, Quang Ninh, and Hanoi. These areas host significant industries, contributing 25.81% of GDP and 17.27% of Vietnam's export value. 
2. Sector-Specific Impact: The typhoon disrupted logistics, manufacturing, agriculture, trade, and tourism. It also led to a 0.15% reduction in GDP growth for 2024, with major sectors like agriculture, industry, and services seeing declines. 

• Banking Sector: Typhoon Yagi worsened debt repayment issues, with VND 100 trillion in outstanding loans impacted. Banks responded by lowering interest rates and extending repayment terms. 
• Insurance Industry: Significant property and life insurance claims are expected, with substantial risk to non-life insurance due to the growing frequency of natural disasters. 

4. Recovery and Opportunities: Certain sectors like construction materials, retail, and logistics may benefit from increased demand due to recovery efforts, while government support programs will be crucial in stabilizing the economy. 

5. Government Response: Swift actions were taken to address the aftermath, including a resolution focusing on supporting economic recovery and stabilizing citizens' lives. Despite the challenges, Vietnam's resilience and policy measures are expected to minimize long-term damage. 

For the full report, kindly access HERE.  

This document is prepared by FiinGroup Joint Stock Company for reference purposes only. This document does not make recommendations to buy, sell or hold any particular stock or transaction.  

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