At last week’s Asia-Pacific Dialogue event organised by the Association of Chartered Certified Accountants (ACCA) in Hanoi, Vietnam was said to boast great potential in addition to a production and business climate fuelled by rising global demand (see pages 5-6).

“Vietnam is the land where the personal and the professional collide to perform, doing investment and business,” said ACCA chief executive Helen Brand. “I’ve been enormously impressed by the government’s serious and systematic intent to improve policies and build the accountancy profession in Vietnam, and how it has stepped onto the world stage by supporting international standards and regulatory frameworks.”

Vo Thanh Hung, Deputy Minister of Finance, also stated at the event, “Vietnam’s economy is significantly improved, with its global ranks escalated, being an attractive investment spot and a big exporter and importer.”

Vietnam has become among the top 40 largest economies in the world, among the 20th biggest attracters of foreign direct investment (FDI), and among the 20th largest nations in the world regarding exports and imports, Hung continued.

The World Trade Organization projects global trade to improve towards 2025 in its latest Global Trade Outlook and Statistics report released in April, citing resilient supply chains as one of the key factors for this recovery. The volume of world merchandise trade is expected to increase by 2.6 per cent in 2024 and 3.3 per cent in 2025, after dropping by 1.2 per cent in 2023.

The International Monetary Fund also said that the world economy has been “strongly recovering”, with a growth forecast of 3.2 per cent this year and next year. The rate forecasted by the EU for 2024 is 3.3 per cent.

However, under projections of the United Nations and the World Bank, the global economic growth rate will be about 2.4 per cent, lower than the 3.1 per cent growth last year. The Organisation for Economic Co-operation and Development has also predicted that the world economy will increase 2.9 per cent this year.

Amid lingering difficulties, the Vietnamese Ministry of Industry and Trade (MoIT) in May underlined that Vietnam’s trade will have many opportunities to expand trade and woo more FDI.

According to the MoIT, Vietnam’s multilateral and bilateral free trade agreements “are having positive impacts on Vietnam’s economy, and becoming a big advantage for Vietnam to expand trade and pull in FDI.”

“Currently despite difficulties, demands in the world market in general and in the European and American markets in particular are gradually recovering due to a trendy reduction in inflation since late 2023,” said Deputy Minister of Industry and Trade Phan Thi Thang. “Developed industrial nations continuing their strategies on diversification of supply and supply chains, and investment flows will facilitate Vietnam to become an important manufacturing and export hub in the global value chains.”

According to the MoIT, many nations in the European and American regions are boosting the development of green economy, digital transformation, and circular economy will usher in many new cooperation opportunities, and green credits and technologies for Vietnam.”

The General Statistics Office (GSO) reported that total goods export turnover the first five months is estimated to reach $ 156.8 billion – up 15.2 per cent on-year, with $43.7 billion for Vietnamese exporters (up 20.5 per cent), and $ 113.1 billion for foreign exporters (up 13.3 per cent – including crude oil exports).

Meanwhile, total goods import turnover of the economy in the period is estimated to hit $ 148.76 billion – up 18.2 per cent on-year, including $54.95 billion for Vietnamese importers (up 24.2 per cent) and $93.8 billion for foreign importers (up 15 per cent).

When it comes to FDI, cumulatively as of May 20, total registered FDI hit $7.94 billion, up 50.8 per cent as compared to the same period last year. Total newly registered and newly added capital, stake acquisition, and capital contributions hit $11.07 billion, up 2 per cent on-year.

At the international conference last week held by ACCA, participants also stressed that Vietnam is now significantly improving its legal framework, and has become a strong selection for many foreign initiatives.

Besides companies in the processing, garments and textiles, and toy industries, which are consistently on the hunt for competitive labour and shifting to new markets like Vietnam, companies in the high-tech industry are also making the move.

For example, in early 2020, Apple announced the plan to produce about 30 per cent of its AirPods wireless earphones in Vietnam. Foxconn Group, Apple’s largest contractor, also revealed plans to invest over $1.5 billion to expand its operation in India. During a press conference in December 2023, AI chipmaker Nvidia CEO Jensen Huang said the company would expand its partnership in Vietnam, calling the country “Nvidia’s second homeland”.