Vietnam Economy - 2021

Economic overview

Vietnam is a densely populated developing country that has been transitioning since 1986 from the rigidities of a centrally planned, highly agrarian economy to a more industrial and market based economy, and it has raised incomes substantially. Vietnam exceeded its 2017 GDP growth target of 6.7% with growth of 6.8%, primarily due to unexpected increases in domestic demand, and strong manufacturing exports.

Vietnam has a young population, stable political system, commitment to sustainable growth, relatively low inflation, stable currency, strong FDI inflows, and strong manufacturing sector. In addition, the country is committed to continuing its global economic integration. Vietnam joined the WTO in January 2007 and concluded several free trade agreements in 2015-16, including the EU-Vietnam Free Trade Agreement (which the EU has not yet ratified), the Korean Free Trade Agreement, and the Eurasian Economic Union Free Trade Agreement. In 2017, Vietnam successfully chaired the Asia-Pacific Economic Cooperation (APEC) Conference with its key priorities including inclusive growth, innovation, strengthening small and medium enterprises, food security, and climate change. Seeking to diversify its opportunities, Vietnam also signed the Comprehensive and Progressive Agreement for the Transpacific Partnership in 2018 and continued to pursue the Regional Comprehensive Economic Partnership.

To continue its trajectory of strong economic growth, the government acknowledges the need to spark a ‘second wave’ of reforms, including reforming state-owned-enterprises, reducing red tape, increasing business sector transparency, reducing the level of non-performing loans in the banking sector, and increasing financial sector transparency. Vietnam’s public debt to GDP ratio is nearing the government mandated ceiling of 65%.

In 2016, Vietnam cancelled its civilian nuclear energy development program, citing public concerns about safety and the high cost of the program; it faces growing pressure on energy infrastructure. Overall, the country’s infrastructure fails to meet the needs of an expanding middle class. Vietnam has demonstrated a commitment to sustainable growth over the last several years, but despite the recent speed-up in economic growth the government remains cautious about the risk of external shocks.

Real GDP growth rate

6.8% (2017 est.)

7.16% (2017 est.)

6.2% (2016 est.)

Inflation rate (consumer prices)

2.7% (2019 est.)

3.5% (2018 est.)

3.5% (2017 est.)

Credit ratings

Fitch rating: BB (2018)

Moody's rating: Ba3 (2018)

Standard & Poors rating: BB (2019)

Real GDP (purchasing power parity)

$775.669 billion (2019 est.)

$724.806 billion (2018 est.)

$676.909 billion (2017 est.)

note: data are in 2017 dollars

GDP (official exchange rate)

$259.957 billion (2019 est.)

Real GDP per capita

$8,041 (2019 est.)

$7,586 (2018 est.)

$7,156 (2017 est.)

note: data are in 2010 dollars

Gross national saving

23.1% of GDP (2019 est.)

23.4% of GDP (2018 est.)

22.2% of GDP (2017 est.)

GDP - composition, by sector of origin

agriculture: 15.3% (2017 est.)

industry: 33.3% (2017 est.)

services: 51.3% (2017 est.)

GDP - composition, by end use

household consumption: 66.9% (2017 est.)

government consumption: 6.5% (2017 est.)

investment in fixed capital: 24.2% (2017 est.)

investment in inventories: 2.8% (2017 est.)

exports of goods and services: 100% (2017 est.)

imports of goods and services: -101% (2017 est.)

Ease of Doing Business Index scores

Overall score: 69.8 (2020)

Starting a Business score: 85.1 (2020)

Trading score: 70.8 (2020)

Enforcement score: 62.1 (2020)

Agricultural products

rice, vegetables, sugar cane, cassava, maize, pork, fruit, bananas, coffee, coconuts

Industries

food processing, garments, shoes, machine-building; mining, coal, steel; cement, chemical fertilizer, glass, tires, oil, mobile phones

Industrial production growth rate

8% (2017 est.)

Labor force

54.659 million (2019 est.)

Labor force - by occupation

agriculture: 40.3%

industry: 25.7%

services: 34% (2017)

Unemployment rate

3.11% (2018 est.)

2.2% (2017 est.)

Population below poverty line

6.7% (2018 est.)

Gini Index coefficient - distribution of family income

35.7 (2018 est.)

37.6 (2008)

Household income or consumption by percentage share

lowest 10%: 2.7%

highest 10%: 26.8% (2014)

Budget

revenues: 54.59 billion (2017 est.)

expenditures: 69.37 billion (2017 est.)

Taxes and other revenues

24.8% (of GDP) (2017 est.)

Budget surplus (+) or deficit (-)

-6.7% (of GDP) (2017 est.)

Public debt

58.5% of GDP (2017 est.)

59.9% of GDP (2016 est.)

note: official data; data cover general government debt and include debt instruments issued (or owned) by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities, as well as intragovernmental debt; intragovernmental debt consists of treasury borrowings from surpluses in the social funds, such as for retirement, medical care, and unemployment; debt instruments for the social funds are not sold at public auctions

Fiscal year

calendar year

Current account balance

$12.478 billion (2019 est.)

$5.769 billion (2018 est.)

Exports

$248.953 billion (2019 est.)

$233.294 billion (2018 est.)

$204.169 billion (2017 est.)

Exports - partners

United States 23%, China 14%, Japan 8%, South Korea 7% (2019)

Exports - commodities

broadcasting equipment, telephones, integrated circuits, footwear, furniture (2019)

Imports

$266.066 billion (2019 est.)

$245.563 billion (2018 est.)

$217.684 billion (2017 est.)

Imports - partners

China 35%, South Korea 18%, Japan 6% (2019)

Imports - commodities

integrated circuits, telephones, refined petroleum, textiles, semiconductors (2019)

Reserves of foreign exchange and gold

$49.5 billion (31 December 2017 est.)

$36.91 billion (31 December 2016 est.)

Debt - external

$96.58 billion (31 December 2017 est.)

$84.34 billion (31 December 2016 est.)

Exchange rates

dong (VND) per US dollar -

23,129 (2020 est.)

23,171.5 (2019 est.)

23,312.5 (2018 est.)

21,909 (2014 est.)

21,189 (2013 est.)