“Vietnam’s Impressive Growth Story: Outpacing Indonesia and Thailand in the Next 5 Years”

In a recent publication by EIU, the Business Environment Rankings report, Vietnam’s business landscape is assessed alongside 82 other countries and territories, accounting for over 90% of the global GDP. This comprehensive evaluation is based on 91 diverse indicators, offering a holistic perspective on the appeal of these regions to investors worldwide.

The report highlights that between 2003 and 2023, Vietnam witnessed the most significant improvement in its business environment among all assessed countries. This impressive progress is attributed to the nation’s embrace of free trade policies, reduction of operational costs for foreign enterprises, and substantial investments in both human capital and infrastructure. Vietnam’s business environment rating soared to 1.3 points, showcasing its competitive advantage in the region.

Additionally, Vietnam has strategically benefited from the “China plus one” policy, aimed at diversifying global supply chains. The nation’s proactive efforts to strengthen international relations have also paid off, fostering stronger economic ties with major export markets like the US and the EU.

Looking ahead, the report forecasts that Vietnam’s business environment will surpass that of regional peers such as Indonesia and Thailand within the next five years. This projection is underpinned by Vietnam’s active participation in multiple free trade agreements (FTAs), its competitive advantage of low labor costs, and the vast market opportunities it presents.

However, the report also cautions that Vietnam still faces certain challenges, including complex administrative processes and the burden of red tape. Additionally, Vietnam is identified as one of the regions that will be significantly impacted by climate change. Its lengthy coastline and populous low-lying areas render the country vulnerable to the increasing incidence of extreme heat events and disruptive storms.