In its East Asia and Pacific (EAP) Economic Update released in October, the World Bank (WB) predicted that developing economies in the EAP region will continue to grow faster than the rest of the world in 2024, but still slower than before the outbreak of the COVID-19 pandemic.
World Bank East Asia and Pacific Chief Economist Aaditya Mattoo pointed to three factors that may impact regional growth in the coming period - shifts in trade and investment, China's slowing growth trend, and increased uncertainty in global policy.
Amidst the difficult global economic context, HSBC still forecast that Vietnam's economy will grow 7% in 2024, becoming the fastest growing economy in ASEAN and producing as much new additional GDP as the Netherlands.
Tim Evans, CEO of HSBC Vietnam, said that Vietnam is now also among the world’s 40 largest economies in terms of GDP, and in the top 20 in terms of trade. This progress has led to an increase in per capita income that has risen 43 times to US$4,300 from US$100 since the early days of the “Doi moi” (Renewal) cause.
Pointing to two major game-changers that are impacting the world - technological advancements and climate change, Evans said that Vietnam has a strong appetite for digital consumption. Demographic tailwinds include a population of over 100 million and a work force that is 70% of the total population.
The rapid rise in internet users also helps drive the adoption of the digital market. Almost 80% of Vietnam’s population now use the internet, thanks to smartphone ownership that has doubled from a decade ago, he noted.
He added that climate change, which is a severe challenge to Vietnam, also represents a huge opportunity for the country and its corporate sector. Vietnam's renewable energy potential is huge given its conducive conditions and the government's pledge to achieve net zero by 2050, said the expert.
Meanwhile, in its latest economic update on Vietnam, Standard Chartered raised its 2024 GDP growth forecast for Vietnam to 6.8% from 6% thanks to better-than-expected third-quarter GDP results.
The bank’s economists said Vietnam’s economic growth momentum has been relatively strong, with improvement recorded in multiple sectors, such as imports-exports, retail sales, real estate, tourism, construction, and manufacturing. Trade recovery and increased business activities and foreign investment will be the main boosters for 2025 and beyond, they added.
