Economic Indicators, FDI, and Trade Trends

Vietnam's economy demonstrated remarkable resilience and growth in 2024, significantly exceeding expectations despite facing external challenges. The country achieved a GDP growth rate of 7.09 percent in 2024, surpassing the National Assembly's target of 6-6.5 percent. This robust performance represented Vietnam's highest growth in two years and positioned the country as one of the standout performers in the ASEAN region.

The economy showed progressive improvement throughout 2024, with quarterly growth rates increasing from 5.98 percent in Q1 to 7.25 percent in Q2, reaching 7.43 percent in Q3, and climbing to 7.55 percent in Q4. Vietnam's GDP reached over VND 11.51 quadrillion (US$476.3 billion) in 2024, with per capita GDP estimated at US$4,700, representing an increase of US$377 compared to 2023.

Looking ahead to 2025, various international organizations have provided growth forecasts, though with some variation due to global uncertainties. The World Bank projects Vietnam's GDP to grow 6.8 percent in 2025 and 6.5 percent in 2026. The Asian Development Bank has upgraded its projection for Vietnam's 2025 growth to 6.6 percent, up from its earlier forecast of 6.2 percent. However, some institutions have become more cautious, with the OECD forecasting 6.2 percent growth in 2025 and 6 percent in 2026, while the IMF has lowered its forecast to 5.2 percent for 2025.

Vietnam's government has set an ambitious target of 8 percent GDP growth for 2025, aiming to achieve a US$500 billion economic scale and lift GDP per capita above US$5,000. The Q1 2025 GDP growth was estimated at 6.93 percent, the highest for the 2020-25 period.

Sectoral composition

The economic structure in 2024 showed the services sector as the dominant contributor, accounting for 42.36 percent of GDP and serving as the primary growth driver with an expansion of 7.38 percent compared to the previous year. The industrial and construction sector contributed 37.64 percent to GDP with an increase of 8.24 percent, while the agriculture, forestry, and fishery sector accounted for 11.86 percent of GDP with growth of 3.27 percent.

Foreign direct investment in Vietnam showed robust performance in 2024 and continued momentum into 2025. In 2024, Vietnam approved 3,375 new projects worth US$19.7 billion, marking a 1.8 percent increase in number but a 7.6 percent decrease in capital compared to the previous year. Additionally, 1,539 projects saw capital adjustments totaling US$14 billion, up 11.2 percent in number and 50.4 percent in capital.

The manufacturing and processing sector led FDI attraction with US$25.58 billion, representing 66.9 percent of the total and up 1.1 percent from the previous year. Real estate followed with US$6.31 billion (16.5 percent of the total, up 18.8 percent), while power production, distribution, wholesale, and retail received US$1.42 billion and US$1.41 billion, respectively.

In terms of source countries, Singapore led FDI inflows with nearly US$10.21 billion, making up 26.7 percent of the total and increasing 31.4 percent year-on-year. South Korea ranked second with US$7.06 billion, accounting for 20.7 percent of the total and up 37.5 percent.

The momentum has continued strongly into 2025. Foreign investment in Vietnam reached nearly US$18.4 billion in the first five months of 2025, representing a 51 percent increase year-on-year. FDI disbursement also showed positive trends, reaching approximately US$8.9 billion in the first five months of 2025, up 7.9 percent from the same period in 2024.

Manufacturing and processing sectors continued to dominate, attracting US$10.39 billion (56.5 percent of total registered capital) in the first five months of 2025, up 32 percent year-on-year. The real estate sector came second with US$4.99 billion, accounting for 27.1 percent of the total and more than doubling compared to the same period last year.

Trade trends

Vietnam's trade performance in 2024 set new records, with total import-export turnover reaching US$786.29 billion, an increase of 15.4 percent compared to the previous year. Export turnover reached US$405.53 billion, up 14.3 percent, while imports totaled US$380.76 billion, up 16.7 percent, resulting in a trade surplus of US$24.77 billion.

The foreign-invested sector continued to play a crucial role in exports, contributing US$290.94 billion (71.7 percent of total exports), up 12.3 percent from the previous year. The domestic sector contributed US$114.59 billion, up 19.8 percent year-on-year and accounting for 28.3 percent of total exports.

Vietnam's exports were driven by strong demand for electronics, with 37 commodities achieving export turnover exceeding US$1 billion, accounting for 94.3 percent of the total. Eight commodities recorded export turnover of US$10 billion, accounting for 69.0 percent of total exports.

China emerged as Vietnam's largest trading partner, with bilateral trade reaching a record US$205.2 billion in 2024, marking an increase of US$33.3 billion compared to 2023. This made China the first trading partner with which Vietnam established trade exceeding US$200 billion. However, Vietnam's trade deficit with China widened significantly to US$82.8 billion in 2024, up from US$49.3 billion in 2023.

Key export categories

Vietnam's export portfolio remained diversified, with top categories including computers, electronics and components, mobile phones and parts, textiles and garments, footwear, and machinery and equipment. The electronics sector benefited particularly from global demand for technology products and Vietnam's role in global supply chains.

Agricultural exports also performed strongly, reaching US$62.4 billion in 2024, an 18.5 percent increase from 2023. Vietnam exported over 9 million tonnes of rice in 2024, generating over US$5 billion in revenue, representing an 11 percent increase in volume.

Outlook

Vietnam maintained strong macroeconomic stability in 2024 and early 2025. The unemployment rate dropped to 2.24 percent in 2024, down from 2.33 percent in 2023, with the urban unemployment rate kept under 3 percent. The inflation rate averaged 3.62 percent in 2024, within manageable levels. By May 2025, inflation had risen slightly to 3.24 percent but remained well within target ranges.

For 2025, inflation is projected to remain within a manageable range of 3-4.5 percent, in line with the National Assembly's goal. Despite global uncertainties and potential trade policy changes, Vietnam's economic fundamentals remain strong, supported by robust manufacturing, continued foreign investment, and improving domestic demand.

The outlook for Vietnam remains positive, though with heightened uncertainties due to global trade tensions and policy changes. The country's strategic location, competitive manufacturing costs, and integration into global supply chains position it well to navigate challenges while capitalizing on opportunities in the evolving global economic landscape.

Vietnam's success in poverty reduction continues, with the multidimensional poverty rate dropping to 2.93 percent by 2023. The country has emerged as a global success story in poverty reduction, with income per capita rising from US$185 in 1993 to approximately US$4,650 today.