2024 Highlights: Vietnam’s economy achieved impressive growth in 2024, with GDP expanding by 7.09% year-on-year (yoy), despite global challenges. Notably, Q4 GDP surged unexpectedly by 7.55%yoy, driven by the recovery of northern provinces following the aftermath of Super Typhoon Yagi. Key growth drivers included low interest rates, robust credit expansion, favorable export conditions, strong FDI disbursement, and the recovery of the private sector, particularly in real estate and construction, which overcame its most difficult period. Domestic consumption was further bolstered by tourism (especially international visitors) and the services sector.

However, challenges remain, including public investment growth of only 3.5%yoy, the lowest net increase in new businesses in years, and persistently high non-performing loan (NPL) ratios, with internal NPLs reaching 4.55%.

2025 Outlook & Key Factors Shaping: The year 2025 is expected to face continued global challenges, with world economic growth projected at 3.3% by the OECD, below the historical average. Major factors include new U.S. trade and tax policies, the Federal Reserve’s interest rate cut trajectory, and escalating geopolitical tensions. The global economy is likely to become more fragmented, with trends such as re-shoring, near-shoring, and friend-shoring reshaping supply chains. Emerging technologies, particularly AI, will continue to drive growth but also intensify competition. Major powers are leveraging technological advancements while controlling exports and protecting intellectual property to curb rivals’ development.

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