From a challenging Q1, the domestic economy outlook has turned more positive as the recovery continues to firm up, which brings Vietnam back as ASEAN’s growth star, according to HSBC analysts. 

Particularly, the momentum of the H2 economic recovery continued to be led by manufacturing, with index of industrial production (IIP) grew 8.4% year-on-year in 11 months.

On FDI, Vietnam continued to attract foreign inflows as fundamental prospects remain positive. Although growth in newly registered FDI moderated in Q3, sectors beyond manufacturing such as real estate and energy saw increases in investment.

A total of 21.68 billion USD was disbursed, up 7.1% year-on-year. This marks the third consecutive year in which Vietnam’s FDI disbursement exceeded 20 billion USD. Intra-ASEAN investments are leading the way, making up 40% of inflows to date. Existing investors continue to make commitments, supporting Vietnam’s expanding manufacturing capabilities, HSBC analysts said.