Vietnam’s Economic Performance in 2024

By Khanh Vu and Phuong Nguyen

HANOI (Reuters) – Vietnam’s economy expanded 7.09% last year to $476.3 billion, outpacing the 5.05% growth in 2023, driven by strong exports and robust foreign investment inflows, as reported by government data on Monday.

Quarterly Growth
Gross domestic product grew 7.55% in the fourth quarter, marking the fastest quarterly growth in more than two years, according to the General Statistics Office (GSO).

The Southeast Asian nation, recognized as a regional manufacturing hub, has benefited from a recovery in global consumption, despite being significantly impacted by Asia’s strongest typhoon last year.

Positive Results Amid Challenges
“This is a positive result amid difficulties including natural disasters and is a good foundation for 2025 growth,” Nguyen Thi Huong, head of the GSO, emphasized at a press conference following the report’s release.

Trade and Export Performance
Exports in 2024 increased 14.3% year-on-year to $405.53 billion, primarily driven by shipments of electronics, smartphones, clothing, and agricultural products. Imports also experienced growth of 16.7%, reaching $380.76 billion, resulting in a trade surplus of $24.77 billion.

Government Measures and Coal Imports
The strong rebound in growth was aided by the government’s decision to increase coal imports for power generation to prevent electricity shortages witnessed in previous years. Coal imports in 2024 rose 24.8% from a year earlier to 63.8 million metric tons, while electricity output grew 9.6% to 293.3 billion kilowatt hours.

Investment and Consumer Prices
Foreign investment inflows to Vietnam rose 9.4% last year to $25.35 billion. Average consumer prices increased 3.63%, and industrial production output rose 8.4%. The benchmark stock index saw a modest increase of 0.13% midday on Monday after the data release.

Vietnam has set an official GDP growth target of 6.5% to 7.0% for this year, with Prime Minister Pham Minh Chinh aiming for 8.0% growth. “Looking forward, Vietnam will actively monitor monetary policies, stabilize exchange rates, and closely observe major trade partners for timely policy adjustments,” Huong noted.

Concerns Over U.S. Elections
She added that Vietnam is among the countries concerned about Donald Trump’s intentions for his second term starting January 20. Trump has suggested imposing new tariffs on imports into the U.S., prompting preparations for potential changes during his administration.

Economic Outlook
Oxford Economics forecasts Vietnam’s GDP to grow 6.5% this year, but warns that the momentum of service exports appears to be slowing. “Despite the positive growth data, challenges from the banking and real estate sectors persist, and credit growth remains below trend,” they cautioned.