Vietnam Economic Update Report

Key export categories include telephones, mobile phones, and components, as well as textiles, footwear, and wood products. Vietnam’s primary export markets are the United States, China, and Japan while China is our largest import country.

The electronics, computers, and components sector continues to lead, generating USD 32.9 billion in revenue, reflecting an impressive 28.6% growth in the first six months of 2024. This sector’s strong performance has had a ripple effect across the economy, supporting other industries. Mobile phones and components are also among the top-performing sectors, contributing USD 27.2 billion, with an

Vietnam’s emergence as a hub for global technology companies is becoming increasingly evident. Companies like Apple have been assembling products in Vietnam since 2019, while manufacturers such as Luxshare Precision and Goertek have moved operations to the country, further boosting FDI and enhancing Vietnam’s position in the global supply chain.

The garment and textile industry reached USD 27.34 billion until September, reflecting an 8.9% increase compared to the same period last year. Leather footwear exports are also expanding, with revenue climbing to USD 14.9 billion, an 11.8% increase.

According to the Vietnam Textile and Garment Association, the industry has recorded its highest export growth in two years. In July and August 2024, textile exports exceeded USD 4 billion per month. Key markets are showing steady growth, including the United States (from 18.3% to 18.2% market share) and Japan (from 16.9% to 17.3%). Meanwhile, South Korea experienced a slight decline, with its share decreasing from 28.7% to 27.6%.

The agriculture and fishery industries have also experienced positive trends. Durian exports have emerged as a major driver, accounting for 40% of vegetable exports, with China being the largest market. The fishery sector achieved USD 6.3 billion in export turnover, a 9% increase compared to the same period in 2023. These gains reflect Vietnam’s continuous efforts to enhance product quality and comply with global standards.

Wood and wood-related exports also show promising growth. In the first half of 2024, wood products recorded USD 5.03 billion in turnover, while related products brought in USD 2.37 billion, both showing increases compared to 2023. Wooden furniture plays a crucial role in this sector, with demand expected to rise significantly in Q4 due to growing needs from the real estate market.

Foreign investment has likewise seen an uptick, complementing Vietnam’s positive trade outlook. With 1,027 new projects and USD 7.64 billion in additional capital, the country showed 7.3% growth in projects and 48% growth in registered capital over 2023. This aligns with Vietnam’s commitment to strengthening its position in global supply chains, particularly in technology and sustainable industries. Business confidence rose to 52% in Q3 2024, up from 45.1% last year, underscoring Vietnam’s growing appeal as a stable and dynamic regional trade hub.

The storm disrupted not only key sectors like manufacturing and agriculture but also banking and services, leading to significant financial strain. In response, banks lowered interest rates and extended repayment deadlines on around 100 trillion VND in loans to support impacted businesses and households.

In September 2024, Northern Vietnam faced the strongest typhoon in its history in the past 70 years, causing significant devastation. The disaster resulted in 345 reported deaths and missing persons, nearly 2,000 injuries, and the destruction of 4,700 homes. The Northwest region, including key metropolitan areas like Quang Ninh and Hai Phong, was severely impacted. Approximately 90% of power and communication networks were disrupted, 60% of factories were flooded, and 40% of industrial facilities suffered extensive damage. Electronics and wood industries were among the hardest hit, with 30% of inventories damaged. Major corporations, including Samsung Industrial Vietnam, LG Electronics, and Wayne, faced significant operational challenges, disrupting production across agriculture, manufacturing, and logistics sectors.

The Vietnamese government responded swiftly to mitigate the impact of Typhoon Yagi. Prime Minister Pham Minh Chinh issued 10 directives to coordinate recovery efforts, tasking ministries with providing immediate assistance to affected residents. In the aftermath, 51,000 fishing boats and 220,000 crew members were directed to safe shelters, while 53,000 individuals from floating fish farms and vulnerable housing were evacuated. Additionally, 74,500 households, comprising approximately 130,000 people, were relocated from flood-prone areas.

The military played a crucial role, deploying more than 438,000 personnel and 6,600 vehicles to assist in rescue and relief efforts. The government also provided 350 billion VND in financial aid and 300 tonnes of rice to affected areas. The Vietnam Fatherland Front raised over 1 trillion VND to support recovery initiatives, reflecting the collective effort across public and private sectors.

International support further bolstered recovery efforts. The Ministry of Agriculture and Rural Development secured pledges from 10 embassies and 16 international organizations, committing 160 tonnes of goods to be delivered by air to assist affected communities.

The disaster highlighted the vulnerability of Vietnam’s infrastructure and underscored the importance of sustainable energy to build resilience. The government is now promoting clean energy solutions to reduce dependence on fossil fuels, which contribute to climate change and intensify natural disasters. Vietnam’s commitment to renewable energy development is seen as a crucial strategy for attracting investment, ensuring long-term stability, and mitigating disaster risks.

Vietnam’s ability to deploy green energy strengthens its supply chain infrastructure and aligns with its ambition to become a regional manufacturing hub. In addition to meeting domestic energy demands, the focus on sustainable energy also positions Vietnam as a global leader in environmental solutions, giving it a competitive edge over countries that rely heavily on fossil fuels.

This transition offers multiple benefits—it not only ensures energy independence but also attracts foreign investments by aligning with global climate action goals. By embedding sustainability into its economic strategy, Vietnam is setting the foundation for future growth, resilience, and global partnerships.

This report was compiled with contributions from the team of business experts in our Vietnam office.

ARC Consulting, a division of ARC Group, is an advisory firm specialised in supporting western companies operating in Asia. We are on a mission is to bridge between the business ecosystems of Asia and those in Europe and the US. Our services cover market entry and expansion, ESG, production and sourcing, cross-border M&A as well as operational improvement and compliance.

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