Vietnam is emerging as a global manufacturing center

That is information in the report “Future of Trade 2030: Trends and markets to watch” of Standard Chartered, based on economic modelling for export projections that includes a survey of more than 500 senior leaders in global enterprises.

Accordingly, global exports will almost double from US$17.4 trillion to US$29.7 trillion over the next decade. The report also reveals 13 markets that will drive much of this growth, identifies major corridors, and five trends shaping the future of global trade. Vietnam is an important market contributing to the growth of global trade. Vietnam's total export turnover is projected to record an average growth of more than 7% per year and hit more than US$535 billion by 2030.

According to this report, 41% of global businesses currently have production activities in Vietnam or plan to manufacture in Vietnam within the next five to 10 years. This shows that Vietnam will be one of the important motivations for global trade growth in the next 10 years.

The US and China will continue to be Vietnam's largest export markets, accounting for 26% and 19% of total exports by 2030, respectively. India is a market that can bring Vietnam a high level of export growth, reaching an average of 11% per year from 2020 to 2030.

With international trade on the rise, Vietnam is emerging as an important manufacturing base. Machinery and electricals, textile and apparel, agriculture and food will dominate exports by 2030 with the proportions reaching 40%, 21%, and 15% respectively, and the compound annual growth rate from 6.4% to 8.1%.

Michele Wee, CEO of Standard Chartered Bank Vietnam, said that with the advantage of an abundant labor force, geographical proximity to global supply chains, and its foreign direct investment-friendly policies, Vietnam is emerging as a manufacturing center of the world, attracting foreign enterprises to invest.

Strengthening integration into the world economy through multiple free trade agreements such as the EVFTA, UVFTA, CPTPP, and RCEP is bringing Vietnam many advantages, helping to promote exports, strengthen the value chain across sectors, and create skilled jobs.

“We are very positive about Vietnam's future trade growth prospects and always try to take advantage of our international network and deep local knowledge to support the process," she said.

According to the report, global trade will be reshaped by five key trends: the wider adoption of sustainable and fair-trade practices; the participation of many economic sectors, greater risk diversification; more digitization, and rebalancing towards high growth emerging markets. Almost 90% of business leaders surveyed agree that these trends will shape global trade and will form part of their five to 10-year cross-border expansion strategies.

Globalization will drive the next decade of growth. Although the growth process focusing on the domestic market has been accelerated, future trade corridors will not just be intraregional, they will be global, spanning Africa-East Asia, ASEAN-South Asia, East Asia-Europe, East Asia-Middle East, East Asia-Europe, and South Asia-US.

The report found a significant trend that is the rise of smart consumption and the adoption of sustainable trade practices in response to climate change concerns. Up to 90% of business leaders surveyed acknowledged the need to apply these practices in the supply chains, however, only 34% ranked it as a top-three priority for execution over the next five to 10 years.