The Vietnamese Economy: A 2024 Outlook

High-Speed North-South Railway Project Approved

On November 30, at the 8th session of the National Assembly, a resolution was passed to approve the investment policy for the high-speed railway project on the North-South axis.

The project has a total length of approximately 1,541 km, starting at Ngoc Hoi Station (Hanoi) and ending at Thu Thiem Station (Ho Chi Minh City), passing through 20 provinces and cities.

The entire line will be newly built with a double-track standard gauge of 1,435 mm, a design speed of 350 km/h, and an axle load of 22.5 tons. There will be 23 passenger stations and 5 freight stations, providing passenger transportation and meeting the dual-use requirements for national defense and security, with the ability to transport freight if necessary. The project will be implemented with public investment, with an estimated total investment of 1.713 million billion VND (67 billion USD).

The National Assembly requests the preparation of a feasibility report from 2025, striving for basic completion of the project by 2035. The preliminary total land requirement for the project is about 10,800 ha, and it is expected that 120,836 people will need to be resettled.

Thus, after nearly 20 years of research, this key project has been approved and will soon become a reality in the near future.

500 kV Power Line Project Completed at Record Speed

The 500 kV power line project, stretching from Quang Trach (Quang Binh) to Pho Noi (Hung Yen), was officially inaugurated on August 29. This is the first key project to be completed in a record-breaking short time: just over 6 months of construction.

With a total length of 519 km and a total investment of over 22,300 billion VND (nearly 1 billion USD), the project plays a crucial role in enhancing the transmission capacity of the 500 kV system from Central to Northern Vietnam, increasing the power transmission capacity from 2,500 MW to 5,000 MW. It improves the stability of the power system, increases electricity supply to the North in 2025 and subsequent years, reduces the risk of overload for existing 500 kV lines and stations, and contributes to ensuring national energy security.

Export-Import Sets New Record of Nearly 800 Billion USD

According to the Ministry of Industry and Trade, export-import activities were a bright spot this year, with a total turnover reaching a new record of nearly 800 billion USD. This figure increased by 15% compared to the previous year and exceeded the government’s target of about 6%. Exports reached over 400 billion USD, up 14.4%, while imports increased by 16.4%.

The trade balance maintained a high surplus of nearly 25 billion USD, marking the ninth consecutive year of trade surplus.

The country had 36 export commodities with a turnover of over 1 billion USD (compared to 33 commodities in the same period last year), including 7 commodities with an export turnover of over 10 billion USD. There were 44 import commodities with a value of over 1 billion USD, accounting for 92.6% of the total import turnover (including 5 commodities with an import turnover of over 10 billion USD, accounting for 51.4%).

According to the Ministry of Industry and Trade, these figures demonstrate the strong recovery of import and export activities in 2024.

Vietnam Collaborates with NVIDIA to Establish AI Centers

Vietnam has partnered with NVIDIA Corporation to establish the AI Research and Development Center, known as VRDC, along with the AI Data Center in Vietnam.

This cooperation agreement marks a significant milestone in Vietnam’s aspiration to become a leading AI research and development hub in Asia, fostering breakthroughs in key technology sectors and creating career opportunities for local talent.

Prime Minister Pham Minh Chinh affirmed that the Vietnamese government is committed to creating the most favorable conditions for the effective implementation of the cooperation contents between the two sides, bringing practical benefits to both parties in the spirit of “harmonious interests, shared risks,” “listening and understanding together; sharing vision and action; doing and winning together, developing businesses and the country; sharing joy, happiness, and pride.”

Minister of Planning and Investment Nguyen Chi Dung also emphasized that innovation is one of the areas that the Vietnamese government pays special attention to and considers as a crucial factor in the country’s development strategy. Vietnam pledges to create the most favorable environment for leading global technology companies, such as NVIDIA, to implement research and development projects in Vietnam.

VinFast Tops the Vietnamese Automotive Market

As of November, VinFast announced that it had delivered more than 16,000 electric vehicles of various models to customers, bringing the total cumulative number since the beginning of the year to over 67,000 units, solidifying its position as the market leader established in October. The gap between VinFast and the second-best-selling car brand is nearly 10,000 vehicles.

This milestone is exceptional for the Vietnamese automotive industry as, for the first time, a domestic car brand, despite its young age, has surpassed all long-standing competitors in the industry, capturing the largest market share. It is also a remarkable achievement in the global electric vehicle market, as an electric car brand has completely dominated the gasoline-powered car brands to rise to the top spot in the market consecutively.

This demonstrates the formidable strength of Vietnam’s automotive industry, represented by VinFast, and affirms that Vietnamese companies have truly mastered the automotive industry chain, from product research to the production of finished products for the market.

More importantly, VinFast has become a symbol of a shift in consumer perception in Vietnam. VinFast electric vehicles, representing the trend of “green, clean, and sustainable” mobility, are increasingly chosen as the primary means of transportation, reflecting the determination of Vietnamese people to protect the environment and move towards a greener future.

In addition to strong sales growth this year, VinFast has also made memorable impressions, such as VinFast VF 3 receiving nearly 28,000 bookings within 66 hours of opening sales and being honored as the 2024 Car of the Year at the Car Awards 2024; VinFast VF 5 being the best-selling model in the A-SUV segment. Notably, VinFast has achieved a localization rate of 60%, surpassing many foreign car brands in Vietnam in a few decades…

Three Laws Amended to Facilitate the Real Estate Market

On June 29, the National Assembly passed the Law amending and supplementing a number of articles of the Land Law, Housing Law, and Real Estate Business Law. The three laws took effect on August 1, five months earlier than previously planned.

With their superior features, these laws are expected to provide significant support to the economy and the real estate market.

One of the most notable changes, which has garnered attention from the public, is the annual construction of the land price table. According to the 2013 Land Law, the government issued a five-year land price framework for each type of land in each region. The amended Land Law has abolished the regulation on the land price framework. Instead, land prices will be determined based on market principles.

As a result, asset prices may be higher, but they will reflect the actual value, not speculative or “virtual” prices. This promotes transparency and a healthy real estate market while reducing land speculation and “virtual land fever.”

SBV Sells Gold to Curb Unprecedented Price Increases

Domestic gold prices experienced a volatile year, surging to unprecedented highs and repeatedly breaking records. Notably, on October 30, the selling price of gold bars reached the 90 million VND/tael mark. Gold jewelry prices also approached this level.

Against the backdrop of domestic gold prices surging and, at times, being nearly 20 million VND/tael higher than world gold prices, the State Bank of Vietnam (SBV) organized several gold bar auction sessions to increase supply, stabilize the market, and narrow the price gap.

Notably, from June 3, the SBV sold gold directly to four state-owned commercial banks for them to sell to the people. The selling price was determined by the SBV based on world gold prices.

Thanks to this measure, the gap between domestic and world gold prices has narrowed significantly. Currently, domestic gold prices are about 5 million VND/tael higher than world prices.