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4M25: Tariff clouds loom over solid performance

Vietnam’s macroeconomic picture in April remains broadly positive, with industrial production and trade indicators continuing to perform well. However, this may represent only a calm before the storm, as early signs of an FDI slowdown and softening in industrial production momentum have emerged. Concerns are mounting that both production and exports may weaken in the coming months amid the looming implementation of U.S. reciprocal tariffs. Against this backdrop, the government’s ambitious economic targets are likely to face mounting headwinds, making domestic drivers—particularly infrastructure investment and public spending—more critical in sustaining growth. Encouragingly, inflation remains under control, offering room for additional policy support in the months ahead.

May 6, 2025

3M25: Steady growth before global turbulence

GSO’s March statistics show that Vietnam’s economy continued to grow steadily ahead of Trump’s reciprocal tariffs. Domestic drivers such as retail sales and public investment accelerated further, serving as key pillars supporting the government's efforts to meet its 2025 targets. Meanwhile, exports and FDI revealed early signs of caution from foreign investors, reflecting growing concerns over potential value chain disruptions stemming from escalating trade tensions. The strong growth in March exports to the U.S. likely reflects a front-loading of shipments ahead of the implementation of reciprocal tariffs. Similarly, the sharp rise in registered FDI may signal increased efforts by multinational companies to diversify their production bases. Looking ahead, the elevated tariff rates imposed by the U.S. on Vietnamese goods are expected to weigh on economic performance of the country in terms of trade activities, foreign investment, and employment. Consequently, Vietnam’s medium-term growth prospects will hinge heavily on the outcomes of high-level dialogues between the two countries and the government’s ability to steer the economy through an increasingly volatile global environment.

April 8, 2025

2M25: Economic activities maintain momentum on domestic factors

Vietnam’s economic momentum remains strong, with domestic consumption emerging as the primary driver, according to GSO’s February report. While export turnover and export-driven industrial production grew at a slower pace compared to December 2024, likely reflecting the worsening new order situation highlighted in recent PMI reports, domestic consumption continued its acceleration. Retail sales expanded by 9% YoY in February, sustaining the momentum seen during the Tet holiday. For the first two months of 2025, domestic sales of goods and services outpaced the growth rate recorded in December, potentially fueled by increased hiring, particularly in the construction sector, alongside the government’s commitment to boosting infrastructure investment. Looking ahead, we expect internal factors, such as a strengthening labor market and robust public investment, to play a leading role in driving economic growth. In contrast, export performance remains uncertain, given the potential impact of Trump’s tariff policies on global trade dynamics.

March 6, 2025

1M25: Tet may mask a stronger economic performance

Vietnam’s economy showed resilience in January despite global trade war concerns. Accounting for a 22.7% reduction in working days due to Tet, our analysis suggests that export activities and industrial production remained robust. Furthermore, both implemented and registered FDI saw meaningful growth, reinforcing Vietnam’s position as a favored destination for foreign investors amid rising global uncertainties. On the downside, a 9.5% increase in retail sales during Tet raises concerns about domestic purchasing power. However, we expect gradual improvement as the labor market strengthens, supported by steady growth in the construction sector seen in recent months.

February 6, 2025

12M24: A brighter economic picture at year-end

The December economic report underscores a brighter performance in the final months of the year following a sluggish period marked by high global uncertainty. On the external front, exports regained growth momentum, likely as U.S. companies accelerated imports to mitigate potential tariff risks ahead of Donald Trump's second presidential term. FDI also stood out as a highlight, with implementation figures reaching a record high in December. Domestically, jobs in the industrial sector continued to grow this month, possibly attributed to the acceleration in total retail sales, driving a rebound in retail sales and boosting shopping and tourism activities. This recovery strengthened consumer confidence and fueled an uptick in spending. These combined factors paint a more optimistic economic picture after months of stagnation caused by global macroeconomic challenges and natural disasters, setting the stage for a promising start to the new year.

January 6, 2025

1M24: Strong trade’s acceleration momentum amid the weak domestic consumption

In January 2024, Vietnam's exports surged 41.98% YoY, driving strong trade momentum. Headline inflation cooled to 3.37% YoY, while registered FDI grew 40.2% annually to USD2.36bn, heavily focused on real estate.

December 30, 2024

11M24: An economic slowdown on external challenges

November economic report underscores early developments in a time of high global uncertainty. On the external front, exports slowed down further as overseas orders waned, as noted in recent PMI reports. FDI also saw a downturn in both implementation and registration, with multinational corporations likely adopting a cautious "wait-and-see" approach due to concerns over potential universal tariffs under President Trump's administration, which could reshape global value chains and trade flows. Domestically, retail sales slightly decelerated, as rising electricity and rental costs, coupled with stalled improvements in industrial labor hiring, have constrained consumers' purchasing power, leading to more cautious spending. These combined factors illustrate the multifaceted pressures Vietnam faces as it navigates an evolving economic landscape shaped by global challenges.

December 6, 2024

10M24: Vietnam economic activities decelerate on Yagi Typhoon aftermath

GSO’s October report shows that Vietnam's economy has slowed down in several aspects due to the lingering impact of natural disasters in the previous month. The export value grows softer, and domestic consumption faces a tighter supply side with decelerating retail sales and food and foodstuff-driven inflation. Furthermore, foreign investors seem to await the U.S. presidential election with the high uncertainty in tariffs and trade policies. Hence, disbursed FDI recorded a lower growth rate, and the registered amount even experienced a substantial reduction. For future development, we predict domestic consumption could contribute more to economic activities as the labor market in the Southern region has become warmer. Additionally, the performance of exports tends to be more uncertain as possible U.S. trade barriers might arise following the new presidents.

November 6, 2024

9M24: Vietnam economy preserves acceleration momentum on exports

GSO’s September could provide an optimistic sentiment for investors with higher-than-expected economic growth, a steady export value, a steady FDI disbursement, and soft inflation despite the Yagi typhoon in September was estimated to cause nontrivial economic losses. Most notably, real GDP grew 7.40% YoY this quarter, 0.31ppts-higher than 2Q24 and 1.31ppts-higher than the market consensus. The 3Q24 economic performance leads government goals, pointed out in the 01/NQ-CP Resolution, to be more achievable. Generally, growth engines remain favorable this month with the expanding export value, especially in the FDI bloc, primarily driving the economic output to accelerate. On the downside, domestic consumption persisted depressed, and Yagi-damaged agricultural and fishery output could put upward pressure on inflation.

October 7, 2024

8M24: Economic drivers preserve their roles

The economic situation in August continued to develop in the trajectory seen in two recent months. While export performance remains solid with a double-digit growth rate for the sixth consecutive month, the domestic consumption, represented by the retail sales, was somewhat worrisome with a deceleration. For the next month, the contribution of exports could be lower in the face of rising competition from cheap Chinese goods. Hence, we predict that economic activities would modestly decelerate as domestic buyers need more time to regain full confidence.

September 6, 2024

7M24: Moving forward on the favorable exports

GSO’s July report showed exports extended the recovery momentum, even growing faster as the number of orders in June surged to the highest level since March 2011, according to the latest PMI report

July 29, 2024

6M24: Economic acceleration on external dynamics

Vietnam’s 2Q24 GDP grew 6.92% YoY, driven by investment and inventory recovery. Meanwhile, June inflation hit 4.34% YoY, and FDI registration surged by 59.82%, signaling strong economic momentum.

July 1, 2024

5M24: Favorable external conditions but raising internal concerns

In May 2024, Vietnam's imports grew 29.84% YoY, outstripping a 16.57% export increase. Retail sales re-accelerated by 9.48% YoY, while headline inflation rose to 4.44% YoY, driven by pork and electricity.

May 29, 2024

4M24: The bright economic picture as dynamics remain favorable

Vietnam’s April exports grew 10.60% YoY, led by electronics. Retail sales increased steadily by 9.04% YoY amid improving industrial employment, while headline inflation rose to 4.40% YoY, driven by surging gasoline prices.

May 2, 2024

3M24: Economic activities lose the acceleration steam

Vietnam’s 1Q24 GDP growth slowed to 5.66% YoY. However, March exports rose 14.19% YoY, securing a 13-month trade surplus, while headline inflation eased to 3.97% YoY as food demand cooled post-Tet.

March 29, 2024

2M24: Economic performance leans on external forces

Vietnam's February exports dipped 4.73% YoY due to Tet, but 2M24 exports grew 19.24%. Retail sales rose 8.49% YoY, while manufacturing-led registered FDI soared 36.80% annually to USD1.93bn.

February 29, 2024

12M23: Domestic output accelerates on the external recovery

Vietnam’s 4Q23 GDP grew 6.72% YoY, driven by industrial and services recovery. December exports rose 13.37% YoY, led by electronics, while year-end registered FDI tripled, boosted by a major LNG project.

December 30, 2023

11M23: Domestic consumption solidifies the economic acceleration

In November, Vietnam's exports grew 6.73% YoY, driven by electronics and agriculture. Retail sales achieved double-digit growth at 10.10% YoY, while headline inflation rose marginally to 3.45% YoY.

November 29, 2023

10M23: Economic acceleration on external hopes

In October, Vietnam's exports grew 5.90% YoY, led by electronics. Newly registered FDI surged by 49.84% YoY to USD5.06bn, while headline inflation cooled slightly to 3.59% YoY due to lower fuel prices.

October 30, 2023

9M23: Gaining momentum on easing global challenges

Vietnam’s 3Q23 GDP grew 5.33% YoY as industrial activities improved. September trade returned to growth with a 4.57% export increase, while headline inflation surged to 3.66% YoY, driven by education fees.

October 1, 2023

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