Workers at Giang Dien Industrial Park, Trang Bom district, the southern province of Dong Nai. (Source: VNA)

The GSO said the IIP in the first five months soared 6.8% year-on-year. The index saw a yearly decline of 2% in last year's corresponding period.

The manufacturing and processing sector increased by 7.3%. Electricity production and distribution was up by 12.7% and water supply, waste and wastewater management and treatment activities by 6.3%. The mining sector dropped by 5.2%.

Sectors that recorded a significant IIP rise were rubber and plastic, up 27%, and furniture, up 24% while others that posted a decrease in IIP were repair, maintenance and installation of machinery andequipment, down 12%; crude oil and natural gas exploitation, down 11% and production of other means of transport, down 5%.

According to the GSO, the IIP increased in 55 localities and dropped in eight during the reviewed period.

The GSO also said that the number of workers in industrial enterprises as of May 1, 2024, increased 1% month-on-month and 3.2% year-on-year.

According to Dao Phan Long, Chairman of the Vietnam Association of Mechanical Industry, the continued efforts of developed countries to diversify supply sources, supply chains and investments would help Vietnam become a significant production and export hub in the global value chain.

However, the global economic forecast for 2024 suggested weak growth, high inflation and geopolitical tensions in various regions. Vietnam's participation in numerous free trade agreements and its open economy made it susceptible to negative impacts from these risks.

Long said firms still needed connectivity solutions provided by ministries and sectors and support from authorities in addressing difficulties relating to capital, interest rates, and administrative procedures.

The Ministry of Industry and Trade pledged to expedite the disbursement of public investment and review pending issues to quickly bring key projects in the electricity, oil and gas, manufacturing, processing and mining industries into operation, creating market capacity for business development.