Vietnam’s economy is experiencing a period of rapid growth and stability and is setting important goals for the future. Vietnam is one of the fastest growing economies in Southeast Asia. It has set itself important economic targets for the next decade and is on track to achieve them. Vietnam’s economic growth has exceeded expectations, reaching a robust 7.09% in 2024, signaling a remarkable recovery after the difficulties of previous years.
The Vietnamese economy has managed to demonstrate its resilience amid global economic uncertainties, achieving a growth rate of 7.09% in 2024. This performance was driven by strong exports and robust foreign investment inflows. The country’s Gross Domestic Product (GDP) reached $476.3 billion, a significant increase from the previous year’s growth rate of 5.05%.[1] This economic expansion has exceeded expectations, largely thanks to increased demand for Vietnam’s exports and the country’s efforts to diversify its production base.
Vietnam’s economic success has been driven by its competitiveness in global trade, attracting foreign direct investment, and capitalizing on shifts in global supply chains. For example, the economic upswing in 2024 was fueled by an influx of foreign investment, particularly from multinational companies seeking to diversify their production activities outside of China due to geopolitical and trade tensions.
Trade and export performance have been important components of Vietnam’s economic growth. It recorded a significant trade surplus, reaching a record surplus in November 2024. This surplus reflected Vietnam’s successful efforts to expand its export markets and diversify its export products. In 2024, Vietnam’s trade surplus was supported by strong demand for goods such as electronics, textiles and agricultural products, which form the backbone of the country’s export economy.
Vietnam’s trade relations with major economies, particularly the United States (US), are also growing rapidly. In the first 11 months of 2024, the US trade deficit with Vietnam exceeded $110 billion. This increase in exports was partly due to the rapid depreciation of Vietnam’s currency, the dong. The weakening of the dong has boosted exports, making Vietnamese goods more affordable for foreign buyers. This has made Vietnam’s products more competitive globally.[2]This shift has been particularly beneficial for the electronics and textile sectors, where Vietnam has become a major global supplier. Strong export growth has significantly supported the country’s GDP and economic stability. The manufacturing sector, including sectors such as electronics, machinery and textiles, has been the main engine of Vietnam’s export growth. Many large companies in these fields have extensive operations in the country, thus contributing to the country’s exports.
Infrastructure development also plays a crucial role in sustaining Vietnam’s economic growth and improving connectivity. The government has decided to invest significantly in infrastructure projects focused on transport and logistics. One of the most ambitious projects is the $67 billion high-speed rail network, which aims to transform the country’s transportation sector. This high-speed rail project is expected to connect major cities, further improve logistics and reduce travel time across the country.[3] Once completed, it will benefit both locally and internationally by increasing trade and business opportunities.
Vietnam aims to reach upper-middle income status by 2030 and high income status by 2045.To achieve these goals, emphasis is placed on sustaining high growth rates in the coming years, with GDP growth projected at 8% in 2025.[4]This growth will be supported by continued investments in infrastructure, education, technology and manufacturing, which are expected to boost productivity and create more high-value jobs.
By 2039, Vietnam’s GDP is expected to reach $1.41 trillion. By 2029, it is projected to surpass Singapore’s GDP and become one of the largest economies in the region.[5] This growth is expected to be driven by a combination of factors, including strong domestic demand, a rising middle class, and an increasing number of foreign companies investing in Vietnam due to its favorable business environment and strategic location.
Vietnam’s path to greater prosperity is not without challenges. A delicate balance in its foreign policy may be crucial for Vietnam’s long-term economic success. Vietnam faces geopolitical tensions, particularly in the South China Sea, which could affect trade routes and regional stability. Boundary disputes in the South China Sea raise concerns over maritime security and trade routes, and these geopolitical issues could create regional instability if not carefully managed. This could negatively affect Vietnam’s economic growth. In addition, Vietnam will need to continue its efforts to diversify its economy and reduce its reliance on low-cost manufacturing. This may require greater investment in education, innovation and technology to promote higher value-added industries.
Overall, Vietnam has come a long way in recent years, demonstrating strong economic growth and stability. With a growth rate of 7.09% in 2024, exceeding expectations despite global economic uncertainties, Vietnam is striving to keep its economic growth sustainable through export growth, foreign investment and large investments in infrastructure projects. Aiming to reach the upper-middle income level by 2030 and become a high-income country by 2045, Vietnam will continue to increase investments in education, technology and manufacturing to achieve these goals. But to meet challenges such as geopolitical risks and the need for domestic innovation, it may be important to increase economic diversification, promote innovation and strengthen its technological infrastructure. Vietnam’s future success depends on its ability to meet these challenges and develop the right strategies for sustainable growth.
[1] “Vietnam’s 2024 GDP growth accelerates to 7.09%, driven by strong exports”, Reuters, https://www.reuters.com/markets/asia/vietnam-2024-gdp-growth-quickens-709-2025-01-06/, (Access Date: 12.01.2025).
[2] “US trade deficit with Vietnam soars beyond $110 billion, as weak dong boosts exports”, Reuters, https://www.reuters.com/markets/us-trade-deficit-with-vietnam-soars-beyond-110-billion-weak-dong-boosts-exports-2025-01-08/, (Access Date: 12.01.2025).
[3] “Vietnam’s high-speed rail hits the brakes on foreign funding”, East Asia Forum, https://eastasiaforum.org/2025/01/09/vietnams-high-speed-rail-hits-the-brakes-on-foreign-funding/, (Access Date: 12.01.2025).
[4] “Vietnam eyes 8% economic growth in 2025, double-digit growth in coming years”, The Voice of Vietnam, https://vovworld.vn/en-US/news/vietnam-eyes-8-economic-growth-in-2025-doubledigit-growth-in-coming-years-1353594.vov, (Access Date: 12.01.2025).
[5] “Vietnam’s economy on track to surpass Singapore by 2029”, Vietnamnet Global, https://vietnamnet.vn/en/vietnam-s-economy-on-track-to-surpass-singapore-by-2029-2357030.html, (Access Date: 12.01.2025).
