Vietnam economic growth beats expectations on trade, FDI

Vietnam’s economy accelerated more than forecast in the second quarter, buoyed by a recovery in trade and increased business activity aided by foreign investment.

Gross domestic product rose 6.93% in the April-June period from a year earlier, according to data from the General Statistics Office in Hanoi on Saturday. That’s faster than the 6% median estimate of analysts surveyed by Bloomberg, and a revised 5.87% expansion in the first quarter. 

The industrial sector remained strong in the first half of the year with manufacturing output growth at 8.67%, the driver of the country’s economic expansion, the statistics office said in the statement.

Double-digit growth in exports alongside resilient foreign investments helped support manufacturing activity in the Southeast Asian nation. The International Monetary Fund forecasts Vietnam’s GDP to expand 6% this year, up from 5% in 2023 — a pace that will make it among Asia’s fastest growing economies. 

While the IMF expects Vietnam’s inflation to be contained this year, Prime Minister Pham Minh Chinh, speaking at a World Economic Forum event in China, urged countries to reduce interest rates in the their respective economies to help boost demand in global markets.