Standard Chartered Forecasts Vietnam’s 2021 GDP Growth at 7.8%

9:56:53 AM | 1/29/2021

Standard Chartered expects Vietnam’s GDP growth to rebound to 7.8% in 2021 from over 2.9% in 2020, with manufacturing likely continuing to drive the economy and helping Vietnam outperform the rest of Asia.   

“The economy emerged from the worst of the COVID-19 downturn in Q3-2020, and we think the recovery remains intact. Vietnam has been one of the best-performing economies globally for the past decade, and we expect this to continue,” said Tim Leelahaphan, Economist for Thailand and Vietnam, Standard Chartered. Standard Chartered’s economists anticipated that improving investment and services growth should support the economy in the coming years. Effective COVID-19 containment measures have further enhanced Vietnam’s appeal to overseas investors, making it an attractive destination globally for foreign direct investment. The country stands to benefit from trade and technology tensions between the U.S. and China, which is expected to continue under the new U.S. administration. Significant supply-chain relocation is already underway as a result of the U.S.-China trade war. Lingering global demand uncertainty and depressed investment sentiment are likely to weigh on FDI inflows, but inward investment should remain strong.“Vietnam is a clear beneficiary, and we expect this trend to continue in the next couple of years as tensions persist. Vietnam will continue to serve as an alternative destination as countries and companies seek to reduce their reliance on manufacturing in China. This is positive for the country’s medium- to long-term growth prospects,” added Tim Leelahaphan.        

By Le Hien, Vietnam Business Forum