Việtnam Maintains Strong Growth Outlook Amid Global Uncertainty

Hanoi, The Gulf Observer: Việtnam continues to attract strong interest from international organisations and global investors despite ongoing global economic uncertainty stemming from geopolitical tensions, trade frictions and shifting monetary policies, according to recent international assessments.

Reports indicate that Việtnam was among Asia’s fastest-growing economies in 2025, with gross domestic product (GDP) expanding by 8.02 per cent — the second-highest growth rate recorded during the 2011–2025 period.

Upbeat Growth Forecasts for 2026

In a report released on January 21, ASEAN+3 Macroeconomic Research Office projected Việt Nam’s GDP growth at 7.6 per cent in 2026, the highest among ASEAN+3 economies, which comprise the 10 ASEAN member states along with China, Japan and the Republic of Korea.

Other financial institutions have also issued positive forecasts. United Overseas Bank (UOB) projected growth of 7.5 per cent, HSBC forecast 6.7 per cent, while the World Bank estimated growth at 6.3 per cent.

AMRO attributed the optimistic outlook to Việt Nam’s expanding role in regional supply chains, particularly in manufacturing and high-technology exports, supported by stable domestic demand and a relatively sound macroeconomic environment.

Strong Investor Confidence

Business sentiment remains robust. The European Chamber of Commerce in Vietnam reported that its Business Confidence Index reached 80 points in the fourth quarter of 2025 — the highest level in seven years.

Approximately 88 per cent of surveyed European firms expressed confidence in Việt Nam’s economic outlook for the 2026–2030 period.

International investors increasingly cite not only competitive costs but also the expansion of manufacturing ecosystems, improved supporting industries, greater participation in higher value-added segments, and ongoing enhancements to the investment climate as key attractions.

Three Key Growth Drivers

International observers commonly highlight three major factors underpinning Việt Nam’s economic momentum:

1. Foreign Direct Investment (FDI):
FDI continues to play a pivotal role, particularly in electronics, technology, green manufacturing and digital transformation sectors. Việt Nam has strengthened its position as multinational corporations diversify production bases.

2. Domestic Consumption:
Private consumption rose by around 8 per cent in 2025, serving as a critical buffer against external shocks and supporting overall economic resilience.

3. Tourism Recovery:
International arrivals surpassed 21 million in 2025, significantly boosting services, employment and household spending.

AMRO further noted that strong global demand for advanced electronics, semiconductors, digital services and artificial intelligence applications provides additional support to highly open Asian economies such as Việt Nam. Deeper integration into regional technology value chains is viewed as a long-term competitive advantage.

Policy Risks and Cautious Optimism

Despite the broadly positive outlook, international institutions have cautioned that prudent policy management will be essential to sustain momentum.

In a late January 2026 update, Fitch Ratings observed that stability and continuity in senior leadership could facilitate policy implementation and reform. However, it warned that ambitious growth targets may increase pressure for rapid credit expansion, potentially raising leverage risks in a highly trade-dependent economy.

Fitch noted that Việt Nam’s credit-to-GDP ratio has risen in recent years, reflecting the central role of credit in growth. The State Bank of Vietnam’s target of approximately 15 per cent credit growth in 2026 was viewed as an effort to balance economic support with financial risk control.

Both Fitch and AMRO also highlighted uncertainties related to global trade policies and financial conditions, particularly given Việt Nam’s position within complex supply chains involving the United States and China.

Foundation for Sustainable Growth

Overall, international assessments suggest that Việt Nam’s key opportunity lies in maintaining macroeconomic stability, improving the investment climate, enhancing the quality of capital inflows and raising productivity.

Such measures are seen as critical to laying a stronger foundation for a new and more sustainable growth cycle beginning in 2026.