Vietnam Market SnapshotsSeptember 25, 2015 11:53 am
Vietnam Market Snapshots
Vietnam has made rapid economic progress since launching its first major economic reforms in 1986. It continues to develop from a low-cost labour economy to a higher value, high-quality enterprise marketplace. Vietnam is one of the most vibrant economies in Asia with a large market for capital goods and a growing domestic market for consumer goods. Vietnam has attracted many multinational corporations, including those that seek ways to diversify their operations away from China in their ’China plus One’ manufacturing strategies.
A few important facts, opportunities and challenges to be considered as below
- Vietnam’s Gross Domestic Product (GDP) in 2014 is USD 186.2 billion, of which industry about 40%, agriculture about 19% and services about 41%.
- Per capita purchasing power is around USD 3,600.
- GDPincreased 5.98% in 2014. An average of 6% growth a year is forecast from 2015 to 2017.
- Retail trade grew 10.6% in 2014
- Young population of about 90 million to date with average of about 29 years old
- About 32 million have broadband access, revealing that Vietnam is amongst the highest internet penetration in South East Asia
- Continuing economic reforms with sectors such as retailing being liberalised to attract foreign investment
- Free Trade Agreements (FTAs) with China, Japan, South Korea, India, Australia, New Zealand, Chile and the EU by the end of this year 2015. It is also in talks on the Trans-Pacific Partnership, and on FTA’s with the United States and Russia. Vietnam joined the World Trade Organisation in January 2007.
- Vietnam’s key export items are telephone sets, electronic products, footwear, textiles and clothing, coffee, rice, seafood, and furniture. Its key export markets are US, EU, ASEAN, China, Japan and others.
- Vietnam’s key import items are dominated by high tech products including electrical machinery and equipment, aircraft, vehicles, and pharmaceutical products. Vietnam imports mainly from China, ASEAN, South Korea, Japan and EU.
- The country has an ambitious program of major infrastructure developments including new urban railway networks, a new international hub airport and expansion of regional airports.
- Vietnam is led by a single political party. There are still remaining key issues on legal framework, business environment and corruption to be improved.
Despite the positive changes and challenges, it is forecast to be one of the top 10 fastest growing economies in the next decades.
Source: Worldbank, UK Trade and Investment
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