Controlled inflation and sustainable exports are also considered important foundations for domestic consumption and industrial production to continue growing.
It can be said that, over the past time, one of the consistent spirits in directing and managing the socio -economy is the steadfastness in the set growth targets and the early and far-sighted vision in all decisions.
In the first quarter of the past 5 years since 2020, the surge of nearly 7% in the first quarter of this year reflected that the economy is on the path of recovery and steady acceleration after difficult periods. Notably, this growth rate has exceeded the target scenario set out in Resolution No. 01 of the Government but has not yet reached the Resolution’s target because the rapid, complex and unpredictable fluctuations of the world situation have significantly impacted domestic socio-economic activities.
In the first quarter, total import and export turnover of goods reached over 202 billion USD, up 13.7% over the same period last year. Trade surplus was 3.16 billion USD. This result was also reflected similarly with Vietnam ‘s Purchasing Managers’ Index (PMI) in March reaching 50.5 points. Exceeding the threshold of 50 means that output and the number of new orders have grown again.
The average consumer price index (CPI) in the first quarter increased by 3.22% over the same period. Inflation was controlled based on the exchange rate being actively, flexibly and appropriately managed, and the lending interest rate level tended to decrease.
Consumption – production – investment help the economy break through
Controlled inflation and sustainable exports are also considered important foundations for domestic consumption and industrial production to continue to grow, thereby contributing to Vietnam’s first quarter economic growth reaching its highest level in the past 5 years.
This positive result helps Vietnam continue to be among the countries with the highest growth in the world and the region. Many international organizations have also updated their forecasts that Vietnam’s economy will have the highest growth in ASEAN this year.
In the first three months of the year, international arrivals to Vietnam increased by nearly 30% compared to the same period last year. This is the highest number of arrivals to Vietnam ever recorded in a single quarter. The recovery of tourism contributed significantly to the growth of retail sales of goods and consumer service revenue, which increased by 9.9% compared to the same period last year. Increased domestic consumption, meaning increased demand, plays an important role in economic growth.
Olga’s Swiss family just arrived in Hanoi this afternoon. The whole family immediately went to the supermarket to buy essential goods.
Ms. Olga Pavlenko – Swiss tourist said: “I often look for Vietnamese goods in my country and coming here I like shopping even more because Vietnamese goods are very diverse and attractive”.
Mr. Bui The Chung – Director of Winmart Xuan Dieu Supermarket, Hanoi shared: “We always have to arrange goods in a convenient, easy-to-see, easy-to-get way for foreign customers while still ensuring the needs of domestic customers in a harmonious way”.
The good growth of both domestic and export markets has created momentum for industrial production in the first quarter to continue to flourish, increasing by 7.8% over the same period, which is also the highest growth rate of the first quarter in the past 5 years, especially the manufacturing and processing sector still occupies the most important position. To encourage and support businesses, the Government has recently had many policies to reduce and extend taxes and land rents.
Mr. Mac Quoc Anh – Director of the Institute of Economics and Enterprise Development commented: “Enterprises have reduced fixed costs, because in fixed costs, tax-reduced costs, businesses have reinvested in production and business activities”.
With the investment pillar, total social investment capital increased by 8.3%, much higher than the same period last year. Registered foreign direct investment capital increased by 34.7% over the same period. International investment capital still believes in Vietnam. Increased resources are the basis for long-term growth.
Mr. Abel Lim – Director of Consulting and Asset Management Strategy, UOB Bank commented: “The Vietnamese Government has implemented very drastic policies to support investors and businesses, perfecting institutions and improving the investment and business environment. This has made businesses increasingly attached to Vietnam”.
The basically stable macro-economy, controlled inflation, and ensured major balances are the foundation for achieving positive growth in the first quarter. This is the result of high determination, great efforts, drastic, timely, and effective actions of the entire political system in directing, operating, and implementing socio-economic development tasks in the face of rapid and unusual fluctuations in the region as well as in the world.
8% growth: High pressure – high determination
According to the survey results on business trends of enterprises in the processing and manufacturing industry, up to 45.8% of surveyed enterprises assessed that the business trend of the second quarter would be better than the first quarter.
It must be said frankly that entering the second quarter, the global economy is facing fluctuations in trade and tariff policies worldwide. Therefore, the pressure is not small in directing and operating socio-economic development to achieve the set growth target. Many international experts believe that flexible and appropriate adjustments are needed to exploit the room for growth.
Faced with fluctuations in international trade, businesses have flexibly changed direction. This is also how many export businesses prepare for the next quarters.
Ms. Phan Thi Thu Trang – Representative of An Lac Wood Company said: “Enterprises must pay attention to the market to switch to suitable alternative sources of raw materials, and at the same time seek export opportunities in other markets such as the EU, Japan…”.
Entering the second quarter, exports are expected to be directly affected by tariff barriers and weakening global demand. However, on the contrary, Vietnam still has other pillars with much room for development, becoming the main driving force for economic growth.
Emphasizing the key role of public investment in economic growth, macroeconomic stability and job creation, the Prime Minister requested the entire political system, from the central to local levels, to clearly identify this as the top priority task in 2025.
Ms. Yun Liu – ASEAN Market Expert, Global Research Department, HSBC Bank shared: “Vietnam still has internal self-reliance pillars. Domestic consumption still has room to recover and has not yet fully returned to pre-pandemic levels. Another pillar is public investment. The government is putting a lot of effort into promoting public investment disbursement. If disbursement can be improved, this will be an important support for the economy this year.”
In the new context, Vietnam’s institutional reforms such as the commitment to cut at least 30% of unfavorable business conditions are promoting a more dynamic and stronger economic environment. Enterprises are expecting strong changes, preferential policies, support, and promoting the pioneering role of the private economic sector from the upcoming Politburo’s Private Economic Development Project.
International organizations also believe that exchange rate and inflation pressures will increase due to global trade risks. This is also something that needs to be closely monitored in order to have appropriate countermeasures.
Mr. Bill Winters – CEO of Standard Chartered Bank commented: “The initial reaction of the market to trade fluctuations is often that the USD will strengthen, leading to the risk of increased exchange rate pressure. Vietnam needs to have flexible measures to manage monetary policy. When monitoring the recent fluctuations, we have seen that the Government has done very well on this issue, so in the coming time, it will also be very proactive.”
Vietnam has a lot of experience in adapting to global economic fluctuations. This puts great pressure on the economy, but also opens up opportunities for Vietnam to improve its competitiveness, promote its internal strength, and ensure the economic growth target of 8% as set.
Our overall goal of stability and development remains unchanged. The growth target of 8% or more remains unchanged, linked to maintaining macroeconomic stability, controlling inflation, ensuring major economic balances, ensuring social security and people’s lives.
Reality has proven that we have overcome difficulties, obstacles and external shocks as we have done in recent years in the context of the Covid 119 pandemic, conflicts in many places around the world, supply chain disruptions, natural disasters, storms and floods. The more difficulties, challenges and pressures, the more courage, effort and strong efforts must be made to rise up, demonstrating the courage, intelligence and core values of the Vietnamese people and the Vietnamese nation.