GDP –The Vietnamese economy grew to US$ 261.9 billion in 2019, representing a growth of 147% since 2009. As shown in the figure below, Vietnam has followed a consistent upward trajectory in its journey of economic advancement, thus, establishing itself as a key character in Asia’s growth story.
GDP per capita–The prevailing average income in Vietnam is US$ 2,715 and its GDP PPP per capita is 8,397 (international $). However, the nation has been closing this gap as indicated through its growth rates wherein the GDP per capita grew by 123% vs 2009 and GDP PPP per capita grew by 112%, thus, indicating an increase in the standard of life.
GDP Growth (%) – Vietnam’s GDP has grown at an accelerated rate averaging 6.3% over the last decade. Moreover, its current growth rate of 7.02% – which is far higher than the global rate of 2.34% – shows Vietnam’s eagerness to be a major global player. Another interesting observation in this graph is that even though Vietnam faced an economic crisis in 2010, it did not drastically decrease its growth rate, unlike several global competitors.
GDP Per Capita Growth (%) –
Vietnam’s GDP per capita grew at an average of 5.2% over the last decade, recording a growth rate of 6% in 2019. This significant increase in GDP per capita is mainly owed to its accelerated increase in GDP, coupled with a moderate increase in population ultimately highlighting the increasing global affordability of the Vietnamese population. This is observed in Vietnam’s rapidly increasing consumer spending which exhibited a growth of 131% over the last decade along with an increase in consumer confidence from 88 in 2013 to 126 in Jan 2020. As indicated in the graph below, the consumer spending in Vietnam has risen significantly, especially in comparison to its regional peers despite their larger economies.
The major sectoral contributions to the nation’s GDP can be broadly segmented into agriculture, industry and services. Though their percentage shares have been roughly the same over the past decade, it is important to note the trending decline in the agriculture sector with a simultaneous growth in services. This is due to the shifting economic activity from the agrarian sector towards the services sector.
Geographic distribution of GDP-Vietnam is divided into three key economic zones (KEZ) namely the Northern, Southern and Central KEZ. The plans for the three regions vary based on geographic competency. The Northern KEZ is focused on agriculture, the Southern KEZ is centered towards technology and exports, and finally the Central KEZ’s purpose is to fuel the other two zones by growing its marine capabilities. However, it is important to note that these regions are ever expanding, and the government is intent on increasing the number of special economic zones in Vietnam.
Foreign trade – Vietnam has increased its exports 235% in the last decade, generating a trade surplus of US$176 billion (2019) thereby, making economic growth more sustainable. The mammoth increase in Vietnamese exports serves as proof of the country’s gradual ascension to the global economic playing field.
Primary Trade Partners –Trade partners of Vietnam can be categorised as importing partners and exporting partners.
The top 5 export markets for Vietnam 2019 were as follows:
The top 5 importing countries for Vietnam in 2019 were as follows:
The top five products exported and imported by Vietnam are as follows:
Exports to GDP Ratio –Vietnam is one of the few nations to have its export to GDP ratio over 100. Given below is a chart depicting Vietnam’s Export to GDP ratio along with that of its regional peers, with the sizing based on GDP.
Debt to GDP Ratio – Vietnam, like Malaysia, stands between advanced economies and developing economies in terms of Debt/GDP. As showcased in the figure below, the debt to GDP ratio in Vietnam is significantly higher than the levels prevailing in other Asian emerging markets, but it is also reflective of a superior standing in comparison to developed nations like Japan and Singapore.The nation’s prevailing debt levels may become crucial determinants of its continued economic ascent.
The Vietnamese government has become increasingly engaged in foreign trade, with particular encouragement from the trade war between the United States and China. Vietnam is currently engaged in 18 trade agreements that are mostly under effect, thereby depicting its strong base in foreign relations despite being such a new country.
As can be seen the table below, Vietnam has several other agreements that are currently under negotiation, and efforts are being ramped up to ratify the agreements that are already in force.
Vietnam’s Trade Agreements can be classified into the following four groups: