Vietnam’s economy predicted to have a rapid boost in the early months, as various indicators skyrocket.

These statistics indicate that Vietnam's economic prospects in 2024 are quite positive.


Positive Signs of the Economy

The General Statistics Office has just released the report on the socio-economic situation in January 2024 with many positive figures.

Specifically, the Index of Industrial Production (IIP) for January 2024 is estimated to decrease by 4.4% compared to the previous month and increase by 18.3% compared to the same period last year. In which, the processing and manufacturing industry increased by 19.3%, contributing 15.1 percentage points to the overall growth; electricity production and distribution increased by 21.6%, contributing 1.9 percentage points; water supply, waste management and treatment increased by 5.7%, contributing 0.1 percentage point; mining industry increased by 7.3%, contributing 1.2 percentage points.

The index of industrial production for January 2024 compared to the same period last year increased in 60 provinces and decreased in 3 provinces nationwide.

The number of workers employed in industrial enterprises as of January 1, 2024 increased by 0.5% compared to the previous month and increased by 0.1% compared to the same period last year.

Investment capital implemented from the State budget is estimated at 31.1 trillion VND, equal to 4.4% of the annual plan and an increase of 12.5% compared to the same period last year (equal to 3.8% in 2023 and an increase of 5.6%).

Structure of foreign investment into Vietnam’s economic sectors in January 2024

The total registered foreign investment into Vietnam as of January 20, 2024, including newly registered capital, adjusted registered capital, and capital contribution, share purchase by foreign investors reached 2.36 billion USD, an increase of 40.2% compared to the same period last year. Foreign direct investment realized in Vietnam in January 2024 is estimated at 1.48 billion USD, an increase of 9.6% compared to the same period last year.

Vietnam’s outward investment in January 2024 has 11 newly granted investment certificate projects with a total capital from Vietnam of 16.2 million USD, 9.3 times higher than the same period last year.

In January, the whole country had 13.5 thousand newly established enterprises, an increase of 2.2% compared to the previous month and an increase of 24.8% compared to the same period last year. In addition, the country also had nearly 13.8 thousand enterprises returning to operation, 2.2 times higher than in December 2023 and a decrease of 8.4% compared to the same period in 2023, bringing the total number of newly established and returned-to-operation enterprises in January 2024 to over 27.3 thousand enterprises, an increase of 5.5% compared to the same period last year.

There were 43.9 thousand enterprises temporarily suspending business with a time limit, an increase of 25.5% compared to the same period last year; 7,798 enterprises suspended operation pending dissolution procedures, an increase of 14%; 2,165 enterprises completed dissolution procedures, an increase of 6.2%. The number of enterprises withdrawing from the market was 53.9 thousand enterprises, an increase of 22.8% compared to the same period last year.

In the first half of January 2024 (from January 1 to January 15, 2024), the total import and export turnover of raw goods reached 29.78 billion USD, an increase of 5.4% compared to the same period last year, of which exports increased by 4.1%; imports increased by 6.8%; trade balance surplus amounted to 0.38 billion USD.

Vietnam Could Become the Fastest-Growing Economy in Southeast Asia

In 2024, there are still potential risks from the global economic environment that continue to have negative impacts on Vietnam’s economic recovery and growth prospects. However, Vietnam still has prospects for development.

Mr. Nguyen Bich Lam – Former Director General of the General Statistics Office said that our economy has a large openness. In 2024, the economic growth mainly relies on the “four-horse carriage” namely: Innovation, ensuring institutional and legal consistency for economic development; promoting domestic market consumption; effectively implementing public investment capital to create spillover effects on foreign investment; boosting exports of goods and services.

In the 6th session of the 15th National Assembly, the National Assembly approved the Socio-Economic Development Plan for 2024 with a target GDP growth rate of 6.0% – 6.5%.

To achieve a GDP growth rate of 6% – 6.5% in 2024, the agricultural, forestry, and fishery sector are expected to increase by about 3% – 3.2%, lower than 0.63 – 0.8 percentage points compared to 2023; the industry and construction sector increases by 6.2% – 6.9%, 2.46 – 3.16 percentage points higher; the service sector increases by 6.7% – 7.1%, 0.28 percentage points higher. Mr. Lam argues that these growth rates are not easy to achieve as the agricultural, forestry, and fishery sector has already grown significantly in 2023.

Regarding the growth rate of Vietnam’s economy in 2024, many foreign experts are quite optimistic. Dr. Hoe Ee Khor – Chief Economist of the ASEAN+3 Macroeconomic Research Office – said: “We forecast Vietnam’s growth rate at 6% this year. We also see that exports will continue to recover but at a moderate pace. And a 6% growth rate is still a fast growth rate compared to many economies in the region”.

Mr. Brian Lee Shun Rong – Macro Economic Researcher at Maybank Investment Bank, Singapore, commented: “Advantages such as strategic location, low labor costs, political stability, and government support will continue to help Vietnam attract foreign investment.

┬áVietnam needs to continue to improve its workforce, train labor with sufficient skills to undertake more complex tasks such as semiconductor production, as well as upgrade infrastructure, airports, highways… It will help Vietnam continue to be an attractive destination for foreign investment in the long term”.

Meanwhile, the Observed Research Foundation suggests that Vietnam, along with some other emerging economies, is a bright spot for investment and growth. Vietnam could potentially become the fastest-growing economy in Southeast Asia in 2024 and 2025.

Previous articleVietnam’s largest province, yet still feels like a ‘tight-fitting shirt’, population of the dependent cities set to expand almost fourfold.
Next articleHo Chi Minh City confidently achieves development goals