1.1..

Vietnam's trade balance of goods is in surplus, while the balance of services

is always in deficit
This implies that Vietnam has a comparative advantage in providing goods to non-
residents and a comparative advantage in providing services to non-residents.
- The outbreak of the covid 19 epidemic caused a period when Vietnam fell into
a goods trade deficit. This can obviously be understood due to the decrease in
domestic consumption of goods from foreign countries. The reason is due to
closed policies and border restrictions from other countries. Exported goods
cannot reach the border gate or have to wait a long time to export, leading to
damage, the fruit cannot be used anymore and is thrown away.
- Balance of trade in services (exports and imports of services): Changes in
tourism spending, remittances from foreign workers and transportation costs
can all affect this factor. The COVID-19 pandemic could significantly impact
Vietnam's services trade balance in 2021-2022, as travel restrictions will reduce
tourism spending. Restricting border gates and sightseeing services for
foreigners entering the country, or restricting Vietnamese people from studying
abroad, has reduced the value of service exports by more than 5 times.
1.2. Vietnam's primary income balance was always in deficit
One of the reasons why payments for investment in Vietnam are much larger than the
income received from Vietnam's investments abroad is the attractiveness of the
investment market in Vietnam for foreign investors:
- Vietnam - a stable and fast-growing economy, becoming an attractive
destination for foreign businesses looking for high profits
- The government increasingly offers many attractive policies for foreign
investors: tax reduction policies, investment incentives and a skilled workforce,
encouraging foreign companies to set up shop.
- As of 2022, Vietnam participates in 15 global free trade international
organizations, such as AFTA, EVFTA, ACFTA.... Free trade in Vietnam
allows foreign businesses to easily access international markets. large market
and potentially higher profits
Meanwhile, in foreign investment by domestic people, very few businesses achieve
large profits, the number of businesses facing risks, limitations, and inefficiencies
accounts for the majority. This may stem from investors' lack of knowledge and lack
of market understanding. In addition, Vietnamese companies do not have the correct
direction as they focus too much on internal development and lack capital or
experience for large-scale foreign investment.
1.3. Impact from the decline in national income on the current balance
As mentioned above, Vietnam's real GDP tends to weaken in 2022-2023, this affects
domestic demand, the decrease in commodity consumption. Lower economic activity
might lead to decreased production of goods and services for export leads to the
current account surplus
1.3. Fluctuations in foreign direct investment due to the COVID 19 outbreak
Delays in disbursing public funds raise concerns about the government
Vietnam's efficiency and ability to manage large projects. This create uncertainty for
foreign investors, making them hesitant to commit their own capital.
Besidesm Public investment projects often involve importing machinery,
equipment, and materials. Delays in disbursing funds lead to postponements in these
imports, reducing the overall import value in the BoP.

FDI is a major source of foreign investment capital into Vietnam. When

foreign companies invest less, less foreign currency flows into the country. This could
weaken the capital account, reducing the flow of foreign capital into the country.
Besides, Decreasing in FDI also affect to export

2.2.