Vietnam's meteorological agency issued the downgrade on Sunday but cautioned about the ongoing risk of flooding and landslides as the storm, the strongest to hit the country in decades, moved westwards.
On Saturday, Yagi disrupted power supplies and telecommunications in Vietnam's capital, Hanoi, causing extensive flooding, felling thousands of trees and damaging homes.
The typhoon and subsequent landslides and floods killed 21 people in Vietnam and injured 229, according to preliminary estimates from the government, after claiming the lives of four people on the southern Chinese island of Hainan and 20 in the Philippines, the first country it hit a week ago.
In Haiphong, a Vietnamese coastal city of 2 million which hosts factories of several multinationals, industrial parks remained closed on Sunday, workers and managers told Reuters.
One was flooded, and workers said they had been sent home after they tried to go to work unaware of the conditions at their plants because telecommunications networks had not been restored.
"The damage for the factories is really significant. Some have lost roofs or entire front facades," said Bruno Jaspaert, head of DEEP C industrial zones, which host plants from over 150 investors in Haiphong and the neighbouring province of Quang Ninh.
He said at least 80% of the factories had been damaged but the industrial parks had not been flooded.
"It might take a month if things go well before I fully recover from this damage," said Do Van Truong, a 45-year-old shop owner in Haiphong, noting the ceiling of his seafood shop had collapsed while power and water supplies had not yet been restored.
Several highways in the north of the country were flooded or seriously disrupted, state media reported, publishing pictures and footage of landslides.
RISK OF FLASH FLOODS
After it made landfall in Vietnam on Saturday afternoon, Yagi triggered waves as high as 4 metres (13 feet) in coastal provinces, leading to extended power and telecommunication outages that have complicated damage assessment, the government said.
The meteorological agency warned of continued "risk of flash floods" in riverside areas, including in Hanoi.
As winds subsided, authorities in Hanoi rushed to clean up streets from toppled trees scattered across the city centre and other neighbourhoods.
"The storm has devastated the city. Trees fell down on top of people's houses, cars and people on the street," said 57-year-old Hanoi resident Hoang Ngoc Nhien.
Hanoi's Noi Bai international airport, the busiest in northern Vietnam, reopened on Sunday after closing on Saturday morning.
