The report pointed out that economic growth in externally oriented Vietnam rebounded in the second quarter but stayed sluggish, given the challenging global economic environment.

In the second half of this year, Vietnamese exports will likely improve modestly as the global electronics cycle rebounds.

In the second half of this year, Vietnamese exports will likely improve modestly as the global electronics cycle rebounds. Vietnam’s domestic services and foreign tourism will likely continue outperforming and stay supportive.

The economy will be held up by easier fiscal and monetary policies, the report said, noting that Vietnam’s construction growth picked up strongly in the second quarter, with momentum to be supported by increased implementation of government infrastructure projects. Improvements would be critical for Vietnam to stay competitive and continue attracting foreign investments over the long term.

Yet, tight monetary conditions in advanced economies will likely restrain a strong upturn in global external demand for Vietnamese products and overall growth prospects, it said.

“Despite the cyclical headwinds, FDI will remain a structural tailwind amid global supply chain diversification,” according to the report.

Vietnam’s export-oriented manufacturing growth decelerated sharply amid global external headwinds but bounced in the second quarter. Similar uptick was also seen in monthly goods exports figures. Electronics, the largest goods export product at nearly 30% of total, could turn positive by the second quarter.

“We expect Vietnam to remain a key beneficiary for re-location or co-location of production, supported by its already well-known and favourable factors,” the report said.

These include competitive costs for a relatively skilled workforce, extensive free trade agreements (FTA), its bright medium-term growth prospects of 6%-7%, and a growing electronics ecosystem.

Total newly registered FDI in Vietnam grew by around 30% year-on-year in the first half after performing poorly in 2022.

Crucially, new manufacturing FDI inflows picked up strongly in 2023, despite global economic headwinds, and after being resilient over the past couple of years (2020 to 2022) when the world suffered from the pandemic.

“This trend reflects foreign investors’ still-high confidence in Vietnam’s long-term potential. Its position as an FDI darling will likely to stay intact for some time,” the report said.

Vietnam's five-month FDI rises sharply nationwide

The total inflows of foreign investment in Vietnam this year to May 20, including new and added investment and contributions for share purchases by foreign investors, reached nearly 10.86 billion USD, down 7.3% year-on-year, but up 10.6 percentage points as compared with the figure in the first four months of this year, the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment reported.

FDI business: Industrial production locomotive

(BGO) – Bac Giang province now has 8 industrial parks (IP) which have attracted 453 projects, including 350 foreign direct investment (FDI) projects with total registered capital of over 8.2 billion USD. Amid many difficulties, the FDI enterprises in the IP maintain stable production and business activities, ensure good policies and rights for labours. 

Hanoi tops country in FDI attraction in first four months

Hanoi led Vietnam in attracting foreign direct investment (FDI) in the first four months of this year, securing more than 1.7 billion USD in capital during the period, according to the Ministry of Planning and Investment.

Bac Giang leads localities nationwide in FDI attraction

(BGO) – In the first quarter this year, Bac Giang province attracted foreign direct investment (FDI) of over 1.1 billion USD, making it the country’s largest FDI recipient during the period. Such achievement amid general difficulties of the global economy has given the locality more motivation to make breakthroughs, reap new result, and complete the goals of socio-economic development in 2023.

PM stresses significance of trust, companionship in partnership with FDI firms

All problems can be solved with trust, sharing, listening, understanding and companionship, stated Prime Minister Pham Minh Chinh on April 22 while a meeting with foreign investors to listen to their opinions and seek measures to remove difficulties facing them.

Source: VNA