Market Outlook: Vietnam today, tomorrow and beyond

Vietnam’s very much on the move, continuing to perform, even a regional outperformer in terms of GDP growth.

Mr. Tim Evans – CEO of HSBC Vietnam, said: “This time a year ago, while in one of the most rigorous lockdowns, we, business leaders, were working hard to arrange vaccinations for our people. We were also making our best efforts to overcome multiple challenges, helping our clients, our people in adapting to a whole new environment, of working and keeping the economy run, remotely”.

“It is always darkest before dawn, and now the dawn has come. Vietnam is again filled with life, with noise, with traffic and with hope. After two years of Pandemic, I’m pleased that we can see each other, not through Zoom, but face to face here in this room. And that leads me to the theme of today’s event Vietnam today, tomorrow and beyond. Why we choose this theme?”, said Mr. Tim Evans.

Early this month, Moody’s upgraded Vietnam to Ba2, following an upgrade by S&P, Vietnam is now only one notch below investment grade. Fitch actually upgraded Vietnam to BB in May 2018 and currently has Vietnam BB rating on positive outlook.

In addition, PMI – a measure of manufacture confidence in the economy – posted 52.7 in August, signaling a solid improvement in the health of the manufacturing sector. Business conditions have now strengthened in 11 consecutive months.

Moreover, Vietnam is set to become the 10^th largest global consumer market by 2030, bigger than Germany and UK’s.

Despite the global challenges, Vietnam’s very much on the move, continuing to perform, even a regional outperformer in terms of GDP growth. HSBC raised GDP growth forecast for Vietnam in 2022 to 6.9%. The country registered an 11-year high growth rate of 7.7% in 2Q22 due to a broad-based recovery, fully opening, domestic demand back on track, manufacturing continues to roar, exports historical heights.

Lower middle-income Vietnam wants to become a developed country, reaching high income status by 2045. The upper-middle class is expected to grow by an average of 17% until 2030e.

Vietnam’s ambitious commitment is reaching its net zero carbon emissions target by 2050. Vietnam’s Prime Minister Pham Minh Chinh emphasised that response to climate change and natural recovery must be the top priority in every development policy, part of the highest ethical standards of every sector, business and individual. Every action must be based on nature and be people-centric so that no one is left behind in the transition to net zero.

Roman Philosopher Seneca once said: “Luck is what happens when preparation meets opportunities”. The country has made its own luck to bounce back firmly. It’s the effective positioning of the economy to capture possibilities.

Mr. Tim Evans once encountered a comment on LinkedIn “US is said to be the land of opportunities, but Vietnam has the people of opportunity, it’s the people that make the difference. I couldn’t agree more. It’s evidenced in the way Vietnamese people get out of Covid-19 and re-build the economy together as one, as well as through all the highs and lows, overcoming all challenges laid before them throughout their history. We’re lucky to be here to witness, support and drive the success story of Vietnam. As the trajectory continues, all sectors should be ready to capture the opportunities to come. HSBC is about making connections to open up a world of opportunities for Vietnam, for its people, for the corporates, for the consumers”.