Vietnam back as ASEAN growth star as outlook turns more positive: HSBC

In a recent article titled ‘2024—a look back at ups and downs’, HSBC noted that growth improved and surprised on the upside, rising to 6.9 per cent and 7.4 per cent in Q2 and Q3 respectively, and therefore, HSBC Global Research has raised its growth forecast for the country for this year to 7 per cent from the earlier prediction of 6.5 per cent.

It maintains its forecast at 6.5 per cent for 2025.

The recovery in the external sector has started to broaden out beyond consumer electronics, although the domestic sector remained relatively muted despite seeing incremental improvements, HSBC noted.

Manufacturing and trade showed resilience and continued to lead the recovery despite concerns that the impact of typhoon Yagi would hit growth, the HSBC article noted.

The country continued to attract foreign direct investment (FDI) as fundamental prospects remain positive. Although growth in newly registered FDI moderated in Q3 2024, sectors beyond manufacturing like real estate and energy saw increases in investment.

A total of $21.68 billion was disbursed—up by 7.1 per cent year on year (YoY). This is the third consecutive year in which Vietnam's FDI disbursement exceeded $20 billion.

Intra-ASEAN investments are leading the way, making up 40 percent of inflows to date. Existing investors continue to make commitments, supporting Viet Nam's expanding manufacturing capabilities, the HSBC article observed.

ALCHEMPro News Desk (DS)