Photo: iStock
Péter Klemensits
15/05/2025 06:00
By 2023, Vietnam’s economy had grown to approximately 430 billion US dollars, making it the 35th largest economy in the world. Average annual GDP growth hovered around 6–7 per cent, and in some years exceeded 7 per cent. The country was among the strongest-performing economies in the post-COVID-19 period, recording growth of 8.02 per cent in 2022.
This success can be attributed to several combined factors, including foreign direct investment (FDI), export-oriented industrialisation, and a growing services sector. Vietnam is among the world’s leading exporters of coffee, rice, and seafood, and it has significantly capitalised on its competitive position in global supply chains.
Per capita GDP reached 4,300 US dollars in 2023, reflecting an improvement in living standards and economic conditions for citizens. This growth lifted millions out of poverty, with the poverty rate falling from more than 58 per cent in the 1990s to around 6 per cent in recent years. Programmes focused on rural development, agriculture, and microfinance have played a vital role in improving living conditions for the rural population.
Vietnam has also become one of Southeast Asia’s leading manufacturing hubs, especially in electronics, textiles, and agriculture. Its strategic location, young workforce, and continuous investment in infrastructure have made it an attractive destination for multinational companies seeking to expand operations in the region. Through political reforms, tax incentives, and improved legal frameworks, Vietnam has created a favourable environment for foreign investors. FDI has significantly contributed to the growth of the manufacturing sector, particularly in textiles, electronics, and consumer goods. Companies such as Samsung and Intel have made major investments in the country.
Vietnam’s integration into the global economy has been supported by various trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU–Vietnam Free Trade Agreement. These have opened new markets for Vietnamese goods and strengthened trade relations with numerous countries.
The Doi Moi reforms laid the foundation for Vietnam’s dynamic economic growth, turning it into one of the fastest-growing economies in the region. This momentum is expected to continue in the years ahead.
The author is a Senior Research Fellow at the Eurasia Center