The destructive 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, according to FiinGroup.
Typhoon Yagi hit Vietnam on 7-8 September.
In its report, titled "Impact of Typhoon Yagi on Vietnam's Economy", FiinGroup said that as of 28 September, the authorities estimated that typhoon Yagi caused damage of exceeding VND81.50tn ($3.28bn). Hai Phong and Quang Ninh were the two localities that suffered the most, with economic losses of VND12.20tn and VND24.80tn, respectively.
The most severely affected provinces are industrial zones that are home to 111 industrial parks with 4,760 foreign direct investment (FDI) enterprises operating in key sectors such as information technology, manufacturing, construction and tourism. The agricultural sector was the hardest-hit sector, incurring damages of more than VND30.80tn, accounting for 38% of the total economic losses.
Impact on insurance industry
Typhoon Yagi has posed significant challenges to Vietnam’s insurance industry. The estimated insurance claims for damages to people and property caused by the typhoon are already in the trillions of VND and continue to rise.
Preliminary statistics as of 17 September 2024 indicate that there have been 329 deaths and missing persons; approximately 1,929 injuries; over 234,700 houses, 1,500 schools and numerous infrastructure projects collapsed or damaged; 726 dike incidents; more than 307,400 hectares of rice, crops and fruit trees flooded and damaged; 3,722 aquaculture cages damaged or washed away; nearly 3 million livestock and poultry dead and nearly 310,000 urban trees broken. These are preliminary figures, as the full extent of the damage caused by typhoon Yagi and its aftermath has yet to be comprehensively and fully assessed.
Typhoon Yagi will significantly raise the cost of insurance claims for companies, leading to negative indirect effects on reinsurers (particularly the Vietnam National Reinsurance Corporation (Vinare) – the largest reinsurer in the country).
FiinGroup, which offers financial data, business information, industry research and other premium data-driven analytics services, said that other effects caused by Yagi include:
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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.
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Recovery and Opportunities: Certain sectors like construction materials, retail and logistics may benefit from increased demand due to recovery efforts, while government support programmes will be crucial in stabilising the economy.
Government Response: Swift actions were taken to address the aftermath, including a resolution focusing on supporting economic recovery and stabilising citizens' lives. Despite the challenges, Vietnam's resilience and policy measures are expected to minimize long-term damage.
To read the FiinGroup report, please click here.