ASEAN AS A POSITIVE FACTOR FOR

ECONOMIC GROWTH IN VIETNAM

-Bachelor’s Seminar-

Winter Semester 2022/2023

Supervisor:
Dr. Lars O. Pilz
Dipl.-Volksw./Dipl.-Hdl. Marko-René Sušnik
Faculty of Economics and Business Administration Goethe University Frankfurt

Submitted by:
Truong Kim Le - 13484
 TABLE OF CONTENTS

TABLE OF CONTENTS 2

LIST OF ABBREVIATIONS 3

LIST OF FIGURES 4

ABSTRACT 5

ASEAN AS A POSITIVE FACTOR FOR ECONOMIC GROWTH IN VIETNAM 6

1. ECONOMIC GROWTH 7
1.1 Trade 7
1.2 Labor Market 9

1.3 Policy 10
1.4 Infrastructure 12

2. ASEAN – VIETNAM FACING THE COVID-19 PANDEMIC 12

2.1 Impact of Covid-19 on Vietnam’s economy 13
2.2 ASEAN’s response to COVID-19 14
2.3 Mutual reciprocity between Vietnam – ASEAN 14

3. CHALLENGES 15
3.1 Trade 15
3.2 Labor 16
3.3 Policy 17

CONCLUSION Error! Bookmark not defined.

REFERENCES 20
 LIST OF ABBREVIATIONS

ASEAN The Association of Southeast Asian Nations

ADB Asian Development Bank

AEC ASEAN Economic Community

AFTA ASEAN Free Trade Area

CCRT Catastrophe Containment and Relief Trust

CPTPP Comprehensive and Progressive Agreement for Trans-Pacific Partnership

EVFTA European Union–Vietnam Free Trade Agreement

FDI Foreign Direct Investment

FTAs Free Trade Areas

GDP Gross Domestic Product

IMF International Monetary Fund

JICA Japan International Cooperation Agency

MSMEs Micro, Small and Medium Enterprises

OECD Organization for Economic Co-operation and Development

RCEP Regional Comprehensive Economic Partnership

WTO World Trade Organization

 LIST OF FIGURES

Figure 1: Regional trade grouping in East Asia………………………………………………….8

Figure 2: FDI net inflows of Vietnam period 1996 - 2020 (current US$) .......................................8

Figure 3: Additional GDP growth in 2015 compared to baseline in 2004 (current US$) ...............9

Figure 4: GDP per capita (current US$). Source: World Bank…………………………………16

 ABSTRACT
The study attempts to investigate the economic combination of the positive role of
Asean creating opportunities for the development of diverse aspects of Vietnam's economy. In
addition, the challenges of economic development before and after Covid-19 to find the right
solution. In particular, the study focuses on determining the reciprocal connectivity of ASEAN -
Vietnam. To achieve the purpose of this research, several hypotheses have been put forward.
And the results obtained from the study are compared by investigating reputable and factual
analytical data. And according to the comparison of results and conclusions have been made.
The analysis and discussion mention the trade, policy, labor market, infrastructure, and
challenges of ASEAN in general and Vietnam in particular in the field of economic
development. Thereby showing the cooperation strategy that ASEAN and Vietnam face the
Covid-19 pandemic. There is really no denying that the value of the study is to provide a
foundation of the economic integration of Vietnam in Asia and an analytical look at the benefits
of becoming a member of Asean in economic development before and after the Covid-19 period
at the macro-level. To sum up, it is clear that the problems and challenges addressed by ASEAN
have implications for the future economic growth.
Keywords: ASEAN, Covid-19, economic, Vietnam.
 ASEAN AS A POSITIVE FACTOR FOR ECONOMIC GROWTH IN VIETNAM

The Association of the Southeast Asian Nations (ASEAN) was established on the 8 th of
August 1967 in Bangkok, Thailand with its 5 original members of Indonesia, Philippines,
Malaysia, Singapore and Thailand. In 1992, Vietnam joined the Treaty of Amity and
Cooperation in Southeast Asia as an observer, attending annual ASEAN Ministerial Meetings.
During this time, Vietnam has already shown its enthusiasm through participating in a number of
specialized ASEAN cooperation committees. In July 1994, Vietnam was invited to attend the
first meeting of the ASEAN Regional Forum and became one of its founding members. July 28,
1995, Vietnam officially became the 7th member of the organization, following the ASEAN
Foreign Minister Meetings in Brunei Darussalam.

Historically speaking, the joining to the bloc marked an important milestone in the
nation’s foreign policy since the August Revolution in 1945 and the Economic Reformation (Doi
Moi) in 1986. While Doi Moi is a set of new policies promoting the openness to the outside
world, to integrated economies while still being under the same centralized structure (Investment
Policy Review of Vietnam, 2008). It proclaimed the accurate and timely decision of the Vietnam
government as an effort to transform the country, actively seeking peace and cooperation with
countries in the area instead of war and enemies, from confrontation to dialogue, from suspicion
to trust, from division to solidarity (Lakatos, A., 2015). An effort to open up to foreign business
collaboration prospects, boost exports, allowing inflow of high-quality but affordably priced
goods from abroad and ultimately leading to the enhancement of Vietnamese people’s quality of
life.

Since the accession to the organization, Vietnam has quickly integrated and deeply
involved in all areas of cooperation of ASEAN. At the same time, Vietnam also made positive
contributions in maintaining intra-regional solidarity, strengthening cooperation between the
member countries as well as between external partners. The participation was an opportunity for
Vietnam towards a multilateral wellness, development and international integration, opportunity
for improving and finalizing domestic policies, in preparation for economic consolidation.
Moreover, Vietnam's ratification of the numerous ASEAN agreements illustrates her dedication
to regional economic cooperation, economic opening, and commercial liberalization. This
determined effort to restructure her economy is attested to by the country's current impressive
economic growth.

Throughout her 27-year-course in the bloc till present day, Vietnam has not only
completed her assigned tasks but also perfectly fulfilled all her designated roles at many
important occasions. That includes being host for the 6th ASEAN Summit in 1998, coordinating
the relationship between ASEAN and key partners, as well as proudly taking the ASEAN 2010
and 2020’s Chairmanship rotation etc.

Most remarkably, Vietnam’s Chairmanship in 2020 took place in the middle of a

worldwide crisis - the COVID-19. By bravely facing the pandemic with correct actions and
programs, being responsible for coordinating ASEAN activities against the virus while at the
same time keeping inlands situation under control. The pandemic came as a test for Vietnam’s
resilience and capability of being Chair, of having the ability to develop and willingness to
devote to this shared region.

1. ECONOMIC GROWTH
1.1 Trade
The ASEAN integration at the most crucial time brought forth a significant opportunity
for Vietnam to expand its worldwide commercial ties, most specifically to her neighboring
countries and ultimately leading to the joining of the World Trade Organization (WTO) in 2007.
Being in ASEAN has motivated Vietnam to restructure its domestic economic policies, as well
as forming a basis for welcoming sources of foreign direct investment (FDI), thanks to the
support from many ASEAN cooperation programs. Such programs as many free trade
agreements (FTAs) between ASEAN member countries and those from outside of the area and
the Regional Comprehensive Economic Partnership (RCEP) paved the path for Vietnam to
signing even more international FTAs such as such as the Comprehensive and Progressive
Agreement for Trans-Pacific Partnership (CPTPP and the European Union - Vietnam Free Trade
Agreement (EVFTA). However, by creating so many trade relations outside of ASEAN instead
of trade diversion, Vietnam is fully aware of the co-development between “domestic” and
“international” economic growth (Deprez, 2018). The author also argued that Vietnam has a
clear mission to gain more “preferable free trade agreements” than those from ASEAN (See
Figure 1).

Figure 1: Regional trade grouping in East Asia. Source: World Bank

For a developing and emerging economy such as Vietnam, FDI is the most accurate
indication for long term cross-border trade relationships (OECD, 2015). Though being
Vietnam’s fourth largest export market, ASEAN remains its most important strategic exporting
region only after the US, European Union, and China. Despite investing in Vietnam much later
than many other countries, ASEAN soon caught up after the accession of the 7th member and the
signing of the ASEAN Free Trade Area (AFTA) in January 1996. Vietnam’s FDI attraction
exceeded US$7.8 billion 2 years later in 1997, at that time accounted for more than one-third of
Vietnam’s FDI inflows, with Singapore being its greatest investor. ASEAN was Vietnam’s first
area of practice, “playing field for trade and investment liberalization”. A generally least risky
and costly learning portal in terms of policies and financial aspects. As a result, a steady increase
in total FDI turnover between Vietnam and the association is recorded in 2019, peaking at more
than 18 million USD.
 Figure 2: FDI net inflows of Vietnam period 1996 - 2020 (current US$). Source: Statista

Furthermore, Vietnam is especially keen on the establishment of the ASEAN Community

(AEC). Begun as a mission from 2003, the AEC blueprint was accelerated to have finished only
12 years later, 5 years sooner than previously planned. The birth of AEC marked a joint effort of
ASEAN member countries to create a single market and single production base, focusing on
measures to facilitate trade, services and investment, complete rules of origin, and strengthen
market development, capital and freer flow of capital, facilitation of the movement of natural
persons, etc., in parallel with strengthening regional production networks through infrastructure,
transportation, information technology and telecommunications, etc. According to a research by
Petri, Plummer and Zhai Fai, 2012, Vietnam benefits the most from the increased tight-knit
relationship of ASEAN with developed East Asian countries namely Japan, South Korea, New
Zealand or Australia… also known as AEC+ AND AEC++. According to, Vietnam's welfare
gains in 2015 from 2004 is the most remarkable out of all ASEAN countries.

Figure 3: Additional GDP growth in 2015 compared to baseline in 2004 (current US$). Source:
Petri, Plummer, and Zhai Fai, 2012

1.2 Labor Market

Along with the Economic reformations in 1986 and the optimal globalization trend,
joining ASEAN has helped foster and prepare Vietnam for the coming rapid changes and
urbanization. From one of the poorest countries in the world, it became a lower middle-income
country in 2011. Vietnam’s labor force landscape is looking more dynamic than ever as FDI
grows, more businesses from foreign investors are built, creating even more job opportunities.
Reports are claiming a rapid increase in the middle class in Vietnam (those who spend on
average $11 to $110 daily (Van, 2021) and steady decrease in unemployment rate. A report by
Boston Consulting Group expects that the Vietnamese middle class will double from 2014 to
2020, accounting for one-third of the population (BMI, 2019). From 2016 - 2021, Vietnam’s
middle-income class has increased by 10.1%, along with higher spending power across all
sectors of products and services (PWC, 2018). This is an impressive growth for a country that
was once one of the least earning countries.
In the same report by PWC in 2018, ASEAN currently holds third place in
countries/regions with the greatest workforce, only after China and India. Such a workforce
should account for 10% of the world's population by 2030. While ASEAN will continue to have
the third-largest labor force globally, the population of Viet Nam, currently a little over 90
million, would still be able to contribute to the large demand of ASEAN and the world. Vietnam
also has a relatively young population, with a median age of 30.7 years and about 52% of the
population in the working age range. The number of educated workers in Vietnam is increasing,
and about 22% of the labor force is regarded as trained or skilled and holds either diplomas or
certificates. These elements provide an optimum demographic structure that ensures a stable
labor supply, as more than a million individuals are added to the workforce each year.
Despite the promising outlook, having a large and young workforce in a fast-growing,
continuously changing world is not enough if education and training are outdated and not
providing the necessary new technologies. Hence, many challenges remain for young unskilled
Vietnamese workers.

1.3 Policy

Policy before Covid19 reforms aimed at attracting more future growth financing will rely
heavily on foreign direct investment (FDI), particularly in industries like infrastructure and
manufacturing where productivity is a consideration. Over time, attention will shift away from
labor-intensive production and toward higher value-added industries like electronics and
automotive. In the future, Vietnam must balance its overreliance on global value chains by
establishing ASEAN as a significant source of export demand in industries like electronics and
agri-products. The ASEAN Member States work together to prevent and lessen the effects of any
regional crises, fostering a stable business environment. The foundation of the ASEAN
Economic Community in 2015 marked a major development in the history of the ASEAN after
nearly 50 years of organization and growth (AEC). By allowing free capital flows, encouraging
impartial economic development, and reducing poverty, the AEC hopes to establish a stable,
successful, and highly competitive ASEAN economic region. Along with reducing
socioeconomic disparity, increasing competitiveness, and luring in foreign business and
investment, it also intends to do so. The four main pillars of the AEC Blueprint are released with
a focus on each one. The goal of ASEAN's economic dimension is to create a single market and
base of production with free trade in products, services, capital, and skilled labor. The AEC
promised that this would be made possible by the adoption of industry-wide cooperation,
common frameworks, and standards. Several measures in the area of competition policy have
been made to improve the ASEAN region's competitiveness. ASEAN wants to grow and become
a more important and active player in the global supply chain. ASEAN has given its approval to
the five free trade agreements with China, Japan, the Republic of Korea, New Zealand, and
Australia, as well as China and India. Scorecard for the ASEAN Economic Community, 2012.
The Socio-Economic and Financial Analysis and Monitoring Division of the ASEAN
Integration Monitoring Board at the ASEAN Secretariat is responsible for producing this policy.
Many nations misjudged the effects of the COVID-19 epidemic from the beginning and failed to
foresee its ramifications. Governments and central banks prepare stimulus packages to support
businesses and individuals during the shutdown or restricted movement, and they relax monetary
rules to support the health sector and economic activities. Specially, tax incentives/reductions for
affected businesses, particularly MSMEs and businesses in the most affected sectors; subsidies
such as cash assistance, electricity discounts, and other things; for households and workers,
including additional incentives for those in the health sector; deferred taxes or loans; are
generally the most common measures; exemptions from or lower government fees and charges.
Along with lowering policy rates and reserve requirements, central banks have also
increased their purchases of government securities and bonds. Institutions of international
finance have also committed to aiding nations impacted by the COVID-19 outbreak. While the
World Bank has invested 160 billion dollars for the long term, the IMF is dedicated to raising the
lending capacity of its members to $1 trillion and working to reduce debt for low-income
countries through the CCRT. funds for the following 15 months. a $6.5 billion support package
for the COVID-19 crisis response was announced by the ADB. The Philippines, Indonesia, and
Vietnam have all received grants from the ADB, which has also supplied support to Vietnam.

1.4 Infrastructure

A standard electric railway with a length of 1,570 km will be created in Vietnam as part
of the North-South railway project. The current, colonial-era, 1-meter gauge track will be
replaced. Travel duration is still about 30 hours despite later improvements, but a new train line
could halve it. In Vietnam, the first line of Ho Chi Minh City’s new metro, stretching over a
19.7km route, is due to begin operating at the end of 2021, according to JICA, which is funding
the project. In Viet Nam, roads are the dominant mode of freight transport supporting the
development of the country as a regional manufacturing hub. Statistics show that roads served
about 77% of all freight transport and 94% of all passengers transported in 2016.
Moreover, the Vietnamese government intends to continue improving its road infrastructure, as
observed from its development plans. Amongst ASEAN countries, Viet Nam has the highest
number of pipeline road and bridge projects in the region.

2. ASEAN – VIETNAM FACING THE COVID-19 PANDEMIC

Coronavirus has become a global pandemic and disaster for mankind. It was confirmed to
have spread to Southeast Asia with the first reported case in Thailand in January 2020 and the
first death in the Philippines on 2 February, both of which were located outside of China.
Afterwards, all ASEAN countries announced Covid-19 and raised the alarm level about this
global disaster. According to WHO statistics by October 2022, there have been approximately
618 million confirmed cases globally and over 60 million infections and fatalities in ASEAN.
Due to implementation of partial and total lockdown, including travel bans, gathering
restrictions, self-isolation, and other business closures; the pandemic has significantly negative
effects on the social, political, and economic sectors, particularly the tourism and travel sectors.
The pandemic produced a loss of 3.3% of ASEAN's GDP when most member nations were
negatively affected, decreasing from 4.5% in 2019; FDI and total trade in the region decreased
by 24.6% and 5.5% respectively, accompanied by the significant decline in tourism, local
consumption, and global supply chains. In addition, vaccination rates are inconsistent in most
ASEAN member states, making recovery efforts challenging.
2.1 Impact of Covid-19 on Vietnam’s economy

Vietnam has experienced a few different phases as a result of the COVID-19 outbreaks.
In the early stages, Vietnam really showed its ability to respond quickly and promptly to
common challenges, by closing borders, airways, tracing positive cases, implementing
centralized isolation, banning public gatherings, urging people to use masks, and organizing
vaccination sessions. However, the long-term outbreak of the pandemic has put Vietnam in front
of economic challenges.
China, the country with seven largest seaports in the world, has decided to close its
borders, suspend trade activities with international countries to prevent the spread of diseases
entering from abroad. This has led to a major challenge for Vietnam whose economy is
dependent on exports and foreign direct investment, along with its geographical location and
supply chain closely tied to China, causing serious disruption of supply chains demand. The
instability of the supply chain has led to production disruptions, shortages, and high input costs,
resulting in price increases for food, gasoline, and building materials, posing a threat to
economic stability. GDP in the third quarter of 2021 decreased by 6.17% compared to the same
period last year, in which, except for the agriculture, forestry and fishery sector, which achieved
a growth of 1.04% but still very low in the past 10 years, while the industry and construction,
and service sectors both decreased by 5.02% and 9.28%, respectively.
The epidemic of Covid-19 also has a direct influence on the labor market and
employment situation in Vietnam. This impact has been covering all regions and industries, from
urban to rural areas. According to a report published by the General Statistic Office, the
unemployment rate in the first quarter of 2020 was 2.22%, up 0.07 percentage points from the
previous quarter and 0.05 percentage points from the same period in 2019. In the second quarter,
as the economy slowed down due to the implementation of social distancing measures, the
situation became more complicated. As a result, many businesses were forced to return their
premises to temporarily or permanently close, resulting in a record-breaking increase in the
unemployment rate over the past five years. Despite economic recovery efforts and epidemic
prevention, which have improved the labor condition and employment within the country, the
average labor force income remains significantly impacted. Employees' average monthly income
was 5.2 million dong in the third quarter of 2021, decreased 877 thousand dong from the
previous quarter and 603 thousand dong from the same period of 2020. Unemployment also
raises a controversial topic of inequality, since up to 83% of female workers lost their salaries or
jobs, while male workers' average monthly salary is 1.4 times more than that compared to female
workers.

2.2 ASEAN’s response to COVID-19

In 2020, when the whole world is fighting against the epidemic, many important
initiatives were launched very quickly and promptly when Vietnam assumed the role of ASEAN
chairmanship. Using the concept "cohesive, proactive, and adaptable," Vietnam promotes a new
method of operation known as "digital diplomacy," which connects countries via the media
during the season of epidemics. Under the leadership of Vietnam, ASEAN has convened a series
of online conferences to debate the response to the pandemic, including the 36th ASEAN
Summit, the 37th ASEAN Summit, the ASEAN Special Summit, and the ASEAN+3 Summit.
Numerous initiatives on cooperation in response to COVID-19 and post-pandemic recovery,
such as the ASEAN COVID-19 Response Fund, the ASEAN Emergency Medical Supplies
Stockpile, the ASEAN Strategic Framework on Emergencies, the ASEAN Overall Recovery
Framework and Implementation Plan, the ASEAN Declaration on the ASEAN Travel Corridor
Agreement Framework, etc. were announced and put into operation, demonstrating ASEAN's
community values in prevention, adaptation, and recovery.

2.3 Mutual reciprocity between Vietnam – ASEAN

In 2020, when the whole world is fighting against the epidemic, many important
initiatives were launched very quickly and promptly when Vietnam assumed the role of ASEAN
chairmanship. Using the concept "cohesive, proactive, and adaptable," Vietnam promotes a new
method of operation known as "digital diplomacy," which connects countries via the media
during the season of epidemics. Under the leadership of Vietnam, ASEAN has convened a series
of online conferences to debate the response to the pandemic, including the 36th ASEAN
Summit, the 37th ASEAN Summit, the ASEAN Special Summit, and the ASEAN+3 Summit.
Numerous initiatives on cooperation in response to COVID-19 and post-pandemic recovery,
such as the ASEAN COVID-19 Response Fund, the ASEAN Emergency Medical Supplies
Stockpile, the ASEAN Strategic Framework on Emergencies, the ASEAN Overall Recovery
Framework and Implementation Plan, the ASEAN Declaration on the ASEAN Travel Corridor
Agreement Framework, etc., were announced and put into operation, demonstrating ASEAN's
community values in prevention, adaptation, and recovery.
As a result of ASEAN's widespread international backing, Vietnam has reaped numerous
economic and medical benefits. While economic growth in the Philippines has dropped by 9.6
percentage points, in Thailand by 6.0 percentage points, and in Cambodia by 3.1 percentage
points as a result of the pandemic, Vietnam has maintained its growth rate despite these
challenges. After a period of locking down and screening, pent-up consumer demand and the
return of the tourism and service industries has made Vietnam's growth rate rise from an
estimated 2.6% in 2021 to 7.5% in 2022, while inflation rate is maintained at 3.8% for the entire
year. The Government of Vietnam has conducted a “Covid-19 Vaccine Appreciation Ceremony”
to express gratitude to the governments of other nations and international partners for their
assistance over the past two years in fighting against the pandemic.

3. CHALLENGES
Besides all the positive factors that ASEAN brings to Vietnam, there are also many
challenges, and even risks that Vietnam must face lately and in upcoming years. It is worth
noticing that many of these challenges stem from other aspects of the same factors that create
opportunities for the country's economic development. In international integration, Vietnam's
economy faces challenges from being directly and quickly affected by economic fluctuations
from the regional and world markets in trading, limitation in labor resources, policies, and
infrastructure. This happens very quickly by economic and financial crises in the region and the
world.

3.1 Trade

The reformation of Vietnam's economy since the launch of Doi Moi, combined with
many beneficial global trends, has helped propel Vietnam from one of the world's poorest
countries to a middle-income economy in a generation. GDP per capita increased 3.6 times
between 2002 and 2021, reaching nearly US$3,700.
 Figure 4: GDP per capita (current US$). Source: World Bank

3.2 Labour

In 2021, there was a 15.3% share of Vietnam’s young generation not in employment,
training, or education (International Labour Organization, 2021). As stated by the Ministry of
Labor, Invalids, and Social Affairs, only 26% of Vietnam's workforce is fully trained, with the
rest lacking skills and failing to meet the needs of businesses (Hong Chieu, 2022). According to
the studies of Nguyen Xuan Son, Operations Director of Manpower Group Vietnam, skilled
workers accounted for only 11.6% of the total, with only 5% fluent in English, presenting a
significant challenge when competing with workers in the region. Vietnamese workers get paid
about $300 on average, much less than workers in the area ($1,992) and the world ($2,114).

Due to the plentiful labour supply, Vietnam has relatively low average wages. According
to the International Labor Organization's Global Wage Database, the monthly average salary in
2020 is around $200, which is lower than the salary in many neighboring Asian countries (China
613 USD, Malaysia 651 USD, Thailand 391 USD) (International Labor Organization, 2021).
Although cheap labor can entice investors, Vietnamese workers struggle to adapt when foreign
firms introduce new manufacturing technologies.

Following the Vietnam Chamber of Commerce and Industry, the majority of Vietnam's
1.3 million electronics workers accomplish simple tasks defined as low-value manufacturing
(Hong Chieu, 2022). This lack of skilled workers, professional supervisors, and managerial skills
is a serious challenge.
 In addition, Nguyen Van Than, Chairman of the Vietnam Association of Small and
Medium Enterprises, recommended that authorities evaluate the salary regime, not only for
ordinary workers but also for the senior group, arguing that there should be benefits for those
who are highly skilled and intelligent. Otherwise, such workers will easily leave for foreign
countries or choose to work with FDI enterprises and foreign companies, making it even more
challenging for small and medium-sized businesses to find the skilled workers they require.

Labor markets would benefit from reducing mismatches caused by workers lacking the
necessary job skills. More formal employment should be encouraged by improving skills and
lowering the costs for businesses to formalize.

3.3 Policy

Policy Recommendations are proposed to minimize the impact on the domestic economy
in ASEAN in general and Vietnam in particular, including capacities, supply chains, labor, and
finance (enterprises and household industries must suffer hardship).
Maintain the economy's productive capacity: The lack of productivity should slow down
debt repayment obligations to reduce companies going bankrupt. Maintain diversification of
production and export bases to promote an open economy and increase market competitiveness.
However, taking precautions and evaluating measures to protect employees, MSMEs, and the
hardest-hit sectors is still necessary.

Keeping the operation of the supply chain (especially medical supplies and agricultural
products): Covid19 creates pressure on the food supply chain, such as the initial steps at the
processing plant and shipping through retailers, as well as the supply chain of medical supplies.
Therefore, it is necessary to re-examine bureaucratic disadvantages and tax policy. Countries and
Vietnam must balance production demand and labor supply. The ASEAN Member States are
determined to review and re-select their trade and tax policies.

Leveraging technology and digital commerce: The need to take advantage of technology
and digital commerce has been taken advantage of during the Covid19 period when people and
businesses had limited movement. Furthermore, social media users are likely to be the primary
beneficiaries, while e-commerce will grow as consumers move away from physical stores and
crowded places. With all the benefits that digital platforms offer, two things are becoming
urgent: the need to address the digital divide between and within AMS and the urgency of
increasing awareness; and capacity force in network security.

Strengthen the social safety net: This is important to reduce poverty and provide
resources for life and society in times of crisis. Workers are under pressure because of the risk of
job loss, unemployment, debt, and depression. This challenge can be cash transfers, insurance,
and financial support in difficult situations. In the long term, it is more challenging to increase
social protection to better prepare for future crises.

Double determination to promote regional integration: It is necessary to link global

economies to preserve and stabilize the socio-economic situation.

Raising all available macro, financial, and structural policy tools: It can be undeniable
the Covid pandemic had a dizzying and severe impact on traffic movement; a series of factories
suffered losses and defaulted, leading to closures and supply chain bottlenecks. Therefore,
policies need to be changed to study where the impacts are caused and how to resolve the crisis
based on monetary, financial, and fiscal tools and the structure of social policies.

CONCLUSION

In conclusion, this paper evaluates the positive impacts of the ASEAN community on
Vietnam's economic growth in various fields. During more than 25 years of joining ASEAN,
Vietnam has been a driving force and a positive contributor to the community's growth and
prosperity. As ASEAN's development orientation is very compatible with Vietnam's foreign
policy, Vietnam has enjoyed significant economic and political benefits, and will continue to
launch initiatives and directions while contributing to the community value. There is no doubt that
the Covid-19 pandemic outbreak poses significant threats to the ASEAN community, it also
presents Vietnam’s opportunity to demonstrate its leadership. The global pandemic has provided
a significant boost to the digital transformation process across all socioeconomic sectors, helping
to rectify problems in the global supply chains, encourage exports and present a wide range of
innovative ideas for the 21st century's economy. However, this global pandemic also depicts
challenges for all nations in terms of utilizing resources, developing human capacity, and laying
the groundwork for digital technological infrastructure to keep up with the massive shifts
necessitated by the pandemic.
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