Strong prospects for a bright 2025

Though the official data on Vietnam’s economic growth for 2024 will be released on January 6, optimistic forecasts have been made, notably regarding the manufacturing and processing industry, considered the mainstay of economic growth and exports.

Platform Seasia Stats specialised in highlighting rankings of economies around the world, on December 17 released a list of Asia’s 15 largest economies in 2025 based on calculations from the International Monetary Fund. Notably, Vietnam is ranked 12th in this list, with a projected GDP scale of $506 billion. “At $506 billion, Vietnam’s economy is rapidly expanding, thanks to its manufacturing boom and foreign investments,” Seasia Stats said.

In October, Standard Chartered forecasted Vietnam’s 2024 GDP growth at 6.8 per cent, up from 6 per cent predicted earlier. This reflects stronger-than-expected Q3 GDP. For Q4, growth is expected to moderate to 6.9 per cent.

Standard Chartered, which expects GDP growth of 6.7 per cent in 2025, noted that Vietnam’s economy has been relatively strong, with improvement across multiple sectors including imports and exports, retail sales, real-estate, tourism, construction, and manufacturing. Trade recovery, increased business activity, foreign investment to be sources of growth in 2025 and beyond.

Forecasting that Vietnam’s economy will grow 6.5 per cent in both 2024 and 2025, global analysts FocusEconomics said in its January 2025 bulletin released last week that this rate was positive amid the economy facing great internal and external difficulties. However, it added that Vietnam remains the top nation in Southeast Asia with the largest economic growth (see chart). Under the group’s calculations, the economy’s GDP will increase from $457 billion in 2024 and $499 billion in 2025 to as much as $7.06 billion in 2029.

The Vietnamese government calculated that Vietnam’s GDP will increase from $430 billion in 2023 to $470 billion in 2024. It is expecting the economy to grow by more than 7 per cent in 2024, one of the few nations to have managed this feat. The government last week also set an ambitious goal that the economy will reach a double-digit growth rate for 2025.

In November, Deputy Prime Minister Ho Duc Phoc stated at the National Assembly (NA) that the Vietnamese economy boasted great potential for larger growth.

“I am sure that the economy’s GDP scale will soar to several trillions of US dollars in the near future, not just around $500 billion like now,” Phoc said. “This year we may reach about $470 billion, but we think it will triple or quadruple in the near future.”

Key driving force

However, DPM Phoc also underlined the urgent need for bigger investment into the economy so that desired growth can be hit. “Vietnam is in critical need for investment, especially funding into infrastructure development including expressways for example. The prime minister has ordered that 5,000km – five times higher than a few years ago – has to be constructed,” he said. “In another case, we will construct the North-South high-speed railway, costing an estimated sum of $67.34 billion.”

In late November, the NA adopted a resolution on developing the railway, in which construction is scheduled to take place from 2027 to 2035. All stages related to making and approving the feasibility study and design are required to be completed in the next two years.

“Moreover, we’ll also carry out many other works, such as Long Thanh International Airport, seaports, programmes on responding to climate change, and initiatives on a just energy transition involving wind, solar, and hydrogen,” Phoc said.

“This would mean that we will need a large volume of money, and we have to boost the development of the real estate, stock, and bond markets. This also means that we will have to mobilise capital from inside the country, from official development assistance from foreign nations, and from the public-private partnership form to boost development,” Phoc said.

Total public investment in 2024 was about $33.6 billion, and the government expects about 95 per cent of this sum will be disbursed for the whole year.

The Ben Thanh-Suoi Tien railway, the first metro line in Ho Chi Minh City, was officially put into operation last week. The $1.72 billion, 19.7-km metro line has 14 stations. It has 17 trains with each train has three cars, accommodating 930 passengers.

The government has determined that in 2025, priority must be placed on boosting economic growth, and this will lay firm groundwork for the country to implement the decade’s socioeconomic strategy. Efforts are to be made to implement strategic breakthroughs [including institution, infrastructure, and education and training], boosting the restructuring of the economy linked with continued renewal of the economic growth model.

Opportunities for further growth

Addressing a government-led press conference two weeks ago in Hanoi, Deputy Minister of Planning and Investment Tran Quoc Phuong said that there would be many opportunities for larger economic growth. “First is exports, as the current export market signal is relatively good. Not only have orders returned to businesses in 2024, the increase in exports is at a good level now,” Phuong said.

Figures from the Ministry of Industry and Trade showed that in 2024, Vietnam’s goods export and import turnover is estimated to have come in at $783 billion, up 15 per cent on-year. This included $403 billion worth of exports, up 13.6 per cent, and $380 billion for imports, up 13.5 per cent. The total trade surplus hit $23 billion.

“Secondly, when it comes to investment, we see that foreign investors and experts are seeing a big rise in foreign direct investment into Vietnam, especially when global figures remain slack,” Phuong said.

Peter Kompalla, chief representative of the Delegation of German Industry and Commerce in Vietnam, Cambodia, Myanmar, and Laos, said that Vietnam had developed into an attractive investment location for German enterprises to numerous factors.

“Vietnam’s reasonable and high-quality labour force offers a competitive advantage, while its open investment environment fosters business growth and collaboration,” Kompalla said. “Moreover, the expanding local market presents lucrative opportunities for companies seeking to establish a presence in Vietnam. These combined factors make Vietnam a strategic choice for German companies looking to expand their operations and tap into the nation’s promising economic landscape.”

The Ministry of Planning and Investment’s latest figures showed that cumulatively as of late November 2024, German companies had almost 480 valid initiatives, registered at $2.8 billion in Vietnam.

Deputy Minister Phuong also noted that Vietnamese business confidence is also on the rise. “Recent months have seen the number of newly registered businesses increase. This means’ confidence in the economic prospects and in government’s economic management have bounced back,” he said.

Pham Minh Chinh, prime Minister It is requested that authorities at all levels have a new mindset for innovation. They must take drastic action in proposing and implementing policies in a spirit of daring to think and do for the common interest. We have determined that 2025 will be the year of speeding up, making breakthroughs, removing difficulties, and overcoming challenges. We will continue macroeconomic stability as a firm foundation for boosting development, and in turn, development will also act as groundwork for stability. All efforts must be made to reach the biggest results from the implementation of all goals in the 2021-2025 Socioeconomic Development Plan. We will also place a prime priority on boosting economic growth based on the firm maintenance of macroeconomic stability, controlling inflation, and ensuring all major balances of the economy with high surpluses. We will continue promoting the implementation of strategic breakthroughs; restructuring the economy in conjunction with growth model innovation; and improving productivity, quality, effectiveness, resilience, and competitiveness of the economy. Especially, we must prioritise growth, and strive for GDP growth to reach over 8 per cent to create momentum to carry out the 2021-2030 Socioeconomic Development Strategy, complete at least 3,000km of expressways, and complete basic construction of Long Thanh International Airport and other major projects. We will also have to eliminate temporary and dilapidated houses nationwide. On that basis, we can create a solid foundation for the country to enter a new era, which strives to become a strong and prosperous nation, with people becoming increasingly happy and affluent.