VinaCapital upbeat about Vietnam’s economic recovery in 2024

In a report released on October 24, Kokalari mainly attributed the slowdown in 2023 to the global market shrinking, leading to a fall in Vietnamese exports.

The chief economist cited statistics saying Vietnam’s exports decreased by nearly 10% over the same period in the first nine months of this year, as exports to the United States, which is Vietnam’s largest export market, nosedived by nearly 20%.

Meanwhile, domestic consumption growth almost remained unchanged year-on-year, compared to the pre-pandemic growth rate of 8-9%. Market trends were impacted by ongoing challenges in the real estate market.

By contrast, foreign tourist arrivals recovered to nearly 70% of pre-COVID-19 levels this year that is expected to fuel GDP growth in 2023.

VinaCapital expects that Vietnam’s GDP growth will likely recover to 6.5% in 2024 thanks to a recovery in exports, said Kokalari.

This will be supported by a recovery in Vietnam’s manufacturing output that is anticipated to grow from 0% in 2023 to 8-9% in 2024, compared to the industry’s long-term average growth of 12% in the pre-pandemic period, analysed the VinaCapital expert.

He also stressed that the comprehensive strategic partnership between Vietnam and the United States unveiled during the recent Vietnam visit by President Joe Biden would be an important turning point, ushering in a new period of development for Vietnam.

VinaCapital’s optimism is driven by a recovery in manufacturing, as US retail inventories have begun to decline sharply after a year of slowing purchasing power. It is estimated that inventories will increase by more than 20% over the same period in late 2022.

According to the expert, the recent lifting of Vietnam-US relations may create a premise for Vietnam to put in an Olympic Games bid in the future. Japan, the Republic of Korea and China once played host to Olympic Games that later gave their economies a strong boost.