William Pesek is an award-winning Tokyo-based journalist and author of “Japanization: What the World Can Learn from Japan’s Lost Decades”.

Few savings have gone from an inspiring achievement to an uplifting story faster than Vietnam.

Just a few months ago, the world marveled at the incredibly low number of COVID-19 infections in Hanoi and its negligible death rate. This aberrant status was a big feather in the government’s hat. Perhaps the biggest winner in the US-China trade war, Vietnam was already seeing a disproportionate number of manufacturing jobs fleeing China. Then a COVID copy to boot.

Today, Vietnam embodies the complacency of the greater Southeast Asia region. As in Thailand, Indonesia and elsewhere, its leaders believed in their own press. They speculated that early mitigation successes could be replicated if needed and that large-scale vaccination programs could wait.

Pathogens don’t make political considerations, and the Delta variant quickly exposes holes in the pandemic armor of Southeast Asia. The mutation – and others that may be underway – is generating a particularly rapid reassessment of Vietnam’s economic health.

If the new Prime Minister Pham Minh Chinh was hoping for any honeymoon, political reality quickly put it back in order. In April, he took the reins from Nguyen Xuan Phuc, who had accelerated reform and modernization efforts during his five years in power.

Simply not enough, as Vietnam’s 98 million people suddenly remind us.

Soldiers spray disinfectant in the streets of Hanoi on July 26: the mutation generates a particularly rapid reassessment of the economic health of Vietnam. © Reuters

The good news is that Chinh’s administration increases Hanoi’s vaccination ambitions. In June, he launched a $ 1.1 billion vaccine fund. And while only 1.4% of the population was fully vaccinated as of August 18, Hanoi is aiming to hit that 75% figure by early 2021. It may be too little, too late, however.

Japan, for example, is currently obsessed with the lambda coronavirus variant, a variant that epidemiologists say could make us nostalgic for the Delta. The United States is already rolling out a third dose for its two best COVID vaccines, produced by Pfizer and Moderna.

This will require a level of logistical genius and aggressive supply efforts for which Vietnam has rarely shown great aptitude. Vietnam wasted a considerable amount of time in 2020 trying to perfect a local vaccine. This next phase of the pandemic will be more about using phones to import remedies.

There is certainly a possibility that Vietnam will surprise us, as it did in 2020. And certainly, some of the country’s biggest stock investors maintain a half-full view.

Last week, Bill Stoops, chief investment officer at Dragon Capital Group, which manages $ 5.8 billion, told Bloomberg that shares in the VN Index could reach 1,500, a gain of 10%, as as vaccination rates increase. VinaCapital Group says it will hunt for bargains for consumer and real estate companies.

May be. But the feeling of economic déjà vu is hard to shake. Few major economies experience greater extremes of perception than Vietnam. Since the late 1990s, the place has been locked into a boom and bust cycle, in which every few years or so the last asset bubble bursts and drives capital out.

Beginning in 2016, Phuc’s administration strived to reduce the amplitude of the swings from irrational exuberance to near panic. Hanoi has increased its ease of doing business score, improved infrastructure, and increased transparency – at least as much as a Chinese-style political system is prepared to do.

The reward: a parade of the biggest names in globalization employing a growing number of Vietnamese. Former US President Donald Trump imposing tariffs on Chinese goods was an excuse for Adidas, Apple, LG, Nike, Panasonic, Samsung and a myriad of others to increase their bets on Vietnam.

The optimistic point of view is that, as new variants of COVID hit China, India, Indonesia, Malaysia, the Philippines and elsewhere, Vietnam might still look good in comparison. The problem, of course, is that Chinh’s government has to multitask in order to make it an outlier in Southeast Asia again.

Last month, that’s exactly what the Chinh administration did when it struck a currency deal with President Joe Biden’s US Treasury Department. By exiting at the end of 2020, Trump put Vietnam on the dreaded list of “manipulators”. It was a confusing gesture. Trump gave China a pass, with $ 16 trillion in gross domestic product, while targeting Vietnam’s economy of $ 354 billion. That’s what Hanoi gets for winning Trump’s trade war.

Everything is now forgotten. The State Bank of Vietnam and Biden’s Treasury Chief Janet Yellen have agreed to lower the temperature and increase cooperation on trade and exchange rates. This allows Chinh’s team to care less about world headlines and more about the health of their people and the national economy.

Case in point: new impetus to relaunch one of the smallest e-commerce markets in Southeast Asia. Earlier this month, Hanoi unveiled a target for the digital economy to generate 20% of GDP by 2025 and 30% by 2030. Given the blazing speed with which tech apps and startups are disrupting savings everywhere, these goals could prove to be too conservative.

Still, all of this suggests that Hanoi understands that it needs to cultivate and tolerate the emergence of an Alibaba Group Jack Ma fame – or two – without making it disappear, Chinese style. This suggests a new impetus to diversify the engines of growth away from the chimney industries, invest more in education and training, and rethink Hanoi’s policy of limiting media freedoms. It also suggests that Chinh’s team knows that the boom-bust cycle must end.

All of this will make little sense, however, if Hanoi does not act equally aggressively and nimbly to restore Vietnam to the status of a COVID success case. There is every reason to believe that Vietnam can do just that. But the clock is ticking harder and faster than ever, leaving no second to lose for this new government.

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