Vietnam's Economy Soars at 6.42% in H1 2024
Vietnam's economy is experiencing a robust expansion, with its GDP growing by 6.42% in the first half of 2024, marking the second fastest rate for this period in the last five years. This remarkable growth has been largely driven by significant contributions from the industry and construction sectors, as well as the services sector.
Key Drivers of Economic Growth
Industry and Construction: The industry and construction sector emerged as a powerhouse, growing by an impressive 7.51%, a substantial rise from last year's 1.13%. This sector alone accounted for 44.28% of the economy’s overall growth. The surge in this sector underscores Vietnam’s robust industrial base and its pivotal role in the country's economic landscape.
Services Sector: The services sector, with a growth rate of 6.64%, was the largest contributor to the economy, adding 49.76% to the GDP. This sector benefited from a sharp increase in exports, fueled by a recovery in global demand. The resurgence in global markets has propelled Vietnam’s services sector, reinforcing its position as a critical component of economic growth.
Agriculture, Forestry, and Fisheries: The agriculture, forestry, and fisheries sector also showed positive growth, albeit at a slower pace of 3.38%. This sector remains crucial for Vietnam, providing employment and sustaining rural economies.
Foreign Trade and Business Landscape
Trade Performance: Vietnam's foreign trade surged by 15.7% year-on-year, reaching a total of US$368.53 billion in the first half of 2024. Despite a 13.5% decline in the trade surplus, which stood at $11.63 billion, the country maintained a robust export performance. The United States emerged as the largest export market for Vietnam, accounting for $54.3 billion of the trade volume, while China remained the largest source of imports, worth $67 billion.
Business Activity: The business landscape in Vietnam showed dynamic activity with 119,600 new businesses entering the market or resuming operations. However, the number of businesses shutting down was also significant, totaling 110,300. This dynamic indicates a vibrant but competitive business environment.
Manufacturing and Processing Industry: A survey conducted in the processing and manufacturing industry revealed that 37.4% of businesses reported improved performance in the second quarter. This positive sentiment within the sector highlights the resilience and potential for continued growth in manufacturing.
Inflation and Consumer Prices
The consumer price index (CPI) rose by 4.08% during the first half of 2024. While inflation remains a challenge, the growth in various economic sectors suggests that Vietnam is managing to balance growth with rising consumer prices effectively.
Conclusion
Vietnam’s economic performance in the first half of 2024 showcases a resilient and rapidly growing economy. With strong contributions from the industry and construction sectors, and a robust services sector driven by global demand, the country is well-positioned for continued growth. The dynamic business environment, coupled with significant trade volumes, further underscores Vietnam’s emerging role as a key player in the global economy.
As the country navigates the complexities of inflation and business dynamics, maintaining this growth trajectory will require sustained efforts and strategic economic management. Vietnam's impressive 6.42% GDP growth in H1 2024 sets a promising tone for the rest of the year, signaling a vibrant and upwardly mobile economy.