Vietnam – ASEAN country attracting large investments

Vietnam’s economic share in ASEAN’s total GDP has grown strongly in recent years, doubling from less than 6% in 2000 to around 12% today… In the long term, Vietnam’s strong economic growth is supported by positive long-term macroeconomic and demographic trends. Vietnam economic growth 2025 will help Vietnam become ASEAN’s rising economic star.

1. ASEAN: An important position in the global economic picture

Last year, ASEAN attracted a record $226 billion in FDI, up 1% compared to the previous year, while global FDI decreased by 2%. ASEAN is now the second largest FDI destination in the world after the US ($310 billion) and surpassing China ($160 billion). This confirms the attractiveness of ASEAN in the context of the region’s total GDP reaching 3,600 USD and expected to grow by about 5% this year.

Mr. Frederick Chin, Head of Wholesale Banking and Markets, UOB Bank (Singapore), said that UOB Bank has seen some clients adopt the China plus one strategy by investing in new manufacturing facilities to serve the needs of the Emerging markets in Southeast Asia, such as a number of new manufacturing facilities established across ASEAN, in areas such as electrical consumer products in Thailand and Vietnam, semiconductors in Singapore and Malaysia, the nickel industry in Indonesia, electric cars in Thailand, etc.

Viet Nam leads Southeast Asia in attracting long term investment opportunities

2. Vietnam: One of the fastest growing economies in ASEAN

Emphasizing the role of ASEAN, including Vietnam, Mr. Phan Van Mai, Chairman of the Ho Chi Minh City People’s Committee affirmed that ASEAN and especially Vietnam are showing the fastest growing trend in the current global economy and continue to be the growth engine of the world economy.

According to forecasts from organizations such as the World Bank and the IMF, ASEAN and Vietnam’s growth will continue to reach high levels in 2025 and the following years, along with advantages when Vietnam currently has 19 bilateral and multilateral free trade agreements (FTAs); Ho Chi Minh City alone has attracted investment from 125 countries and territories, of which Singapore is the largest investor with nearly 2,000 projects….

Vietnam currently accounts for about 12% of ASEAN’s total GDP, a significant increase from less than 6% in 2000. With a population of about 100 million people and an expanding middle class, Vietnam is becoming an attractive destination for international investors. In addition, international trade has maintained a strong recovery in the first half of 2024, and the increase in semiconductor sales from mid-2023 is expected to continue in the second half of 2024. In the first half of 2024, exports and imports increased by 14.0% and 16.6% year-on-year, respectively.

Vietnam’s competitive business landscape is attracting large investments across various sectors, with the processing and manufacturing industry remaining the dominant sector attracting FDI in Vietnam, attracting more than 72% of total investment in 2023. This is in line with the long-standing trend of Vietnam being an important destination for manufacturing due to its competitive labor costs, developed infrastructure, and business-friendly policies. As an important link in the global supply chain, Vietnam has become a favorite destination for corporations looking to diversify their production activities in the context of global instability, supply chain restructuring and the “China+1” wave.

Vietnam: ASEAN’s best country to invest in

3. Many advantages for Vietnam to be a bright star in the ASEAN economy

In terms of demographics, Vietnam has a growing middle class and the third largest population in ASEAN at around 100 million. This provides Vietnam with a favorable environment and Business opportunities in Vietnam in the coming years to encourage more consumer spending as the population continues to grow and become more affluent.

In terms of macroeconomic trends, Vietnam is gradually and successfully transitioning from a low-cost manufacturing economy to a higher value-added technology-driven economy with a strong focus on services, retail and tourism. Based on these strong long-term fundamentals, Vietnam’s economic share in ASEAN’s total GDP has increased sharply, nearly doubling from less than 6% in 2000 to around 12% today.

In addition, Vietnam has benefited from strong growth in trade and Foreign Direct Investment (FDI) across ASEAN thanks to its position as a key member of ASEAN.

In the context of increasing global trade conflicts and rising tariffs, ASEAN is differentiated by its strong and growing trade opportunities in the region. Specifically, ASEAN’s huge trade advantage is supported by 6 long-standing FTAs between ASEAN and China, Hong Kong, Japan, Korea, India and Australia/New Zealand.

In summary, The Vietnamese economy will benefit strongly from the forecast of increased trade growth and increased FDI inflows from ASEAN. In the long term, the demographic advantage as well as macroeconomic factors will help Vietnam maintain its strength as ASEAN’s bright economic star.

If your business is interested in investing in Vietnam or establishing your representative office in Vietnam, please do not hesitate to contact us. S4B Vietnam will be honored to support customers with professional accounting, tax compliance services, and full packaging compliance to representative offices.

If you have any questions, please contact the hotline for support.

>>>Read more: Vietnam’s attractiveness as an “investment destination”

S4B Vietnam

  • Address: Room 701B – 701C, Tower A, Handi Resco Building, 521 Kim Ma Street, Ba Dinh District, Hanoi, Vietnam.
  • Tel: + 84 24 3974 4181
  • Email: service@s4b.com.vn

——————————————–
We Will Show You The Way To Success!