Vietnam's GDP growth forecasted to hit 6.5 per cent in 2022

According to ICAEW, Vietnam was able to bounce back quite quickly in 2021 as compared to the rest of the region. With the easing of restrictions from last year’s fourth quarter that carried over to this year’s first quarter, there has been a significant recovery in its services sector driven by domestic tourism.

Additionally, there should be a boost on the international tourism front as travellers return to Vietnam.

Realised foreign direct investments inflow into Vietnam this year should provide support for construction and labour and also improve export capacity, which still remains healthy.

It was noted that Vietnam was not particularly affected by the Delta variant wave, and hence did not experience large lockdowns that impacted its economy as much as Malaysia and the Philippines did.

The economic recovery path chartered across Southeast Asia has been uneven and must now contend with rising external headwinds from outside the region.

Despite that, an average growth of about 5.8 per cent is expected for the region, which is up 3.7 per cent from last year. This can be attributed to the boost across the tourism sector from the opening of borders and loosening of other restrictions.

Mark Billington, ICAEW international managing director said, “Even though the direct exposure of the events in Europe on Southeast Asia is limited, the region is impacted by global inflation and monetary policies."

"China’s pandemic response policy has also triggered a domino effect of negative impacts on the region’s manufacturing, industrial, and tourism sectors. Without a doubt, these external factors will dampen growth but will not derail it thanks to the expected recovery in the services sector,” added Billington.