Vietnam records strongest H1 GDP growth in 20 years

THE HANOITIMES — Vietnam’s economy is projected to grow by 7.3% in the first half of 2025, which would be the highest growth in the first six months since 2008, according to Finance Minister Nguyen Van Thang.

Thang shared these figures at the government’s socio-economic conference on July 3, the first meeting between the central government and the 34 provinces and cities since they began operating under the new, two-tier local government structure from July 1, following the administrative consolidation.

The finance minister noted that the economy has shown strong performance, with many business, production, and fiscal indicators improving steadily from month to month and quarter to quarter. Specifically, second-quarter GDP growth is estimated at 7.67%, bringing first-half growth to 7.31% year-on-year, the highest level recorded for the same period since 2008, based on data from the General Statistics Office.

At the government's regular press briefing the same day, Minister and Chairman of the Government Office Tran Van Son, the government’s spokesperson said that this was the highest H1 GDP growth in nearly two decades. Other economic indicators also showed positive momentum, notably, the manufacturing and processing sector growing by 10% in six months, becoming one of the few sectors to achieve double-digit growth since 2011.

Exports rose 14.4%, resulting in a trade surplus of approximately $7.63 billion. Total retail sales of goods and consumer services increased by 9.3%.

Registered foreign direct investment (FDI) exceeded US$21.5 billion in the first half of the year, up 32.6% year-on-year and the highest since 2009. A total of 152,700 new enterprises were established or resumed operations, which is 20% higher than the number of businesses leaving the market.

Nearly 24,400 new businesses were registered in June alone, the highest monthly figure ever, with total registered capital reaching approximately $7 billion. Minister Thang attributed this robust performance to the government's timely and effective response to domestic and global challenges, which enabled strong economic growth despite weak global economic prospects.

On July 2, Vietnamese and US negotiators reached a joint statement on a reciprocal trade agreement framework. The same day, General Secretary To Lam held a phone call with US President Donald Trump, reaffirming the comprehensive strategic partnership between the two countries and discussing areas of cooperation, particularly in high-tech sectors.

"This is a significant outcome that builds trust and raises expectations for the business community," Thang noted.

As of July 1, the two-tier local government came into effect in 34 provinces and cities nationwide that stated by the minister as a new phase in administrative institutional reforms within the political system. He believed it has boosted public and business confidence and generated momentum for Vietnam to enter a new development era.

However, Thang acknowledged that the economy still faces numerous challenges.

"Achieving the 8% growth target in 2025 will not be easy, and macroeconomic pressures persist, especially regarding exchange and interest rates," Thang said.

He urged ministries and agencies to support the newly restructured local governments closely to ensure they run smoothly. The State Bank of Vietnam should actively manage monetary policy tools, interest rates, and exchange rates to support production, ensure capital availability, and maintain stability in the monetary and foreign exchange markets.

The Ministry of Finance wants to collect 15% more money than the 2025 budget target and spend 10% less in the last months of the year. Ministries, agencies, and localities are required to monitor essential commodity prices and implement timely measures to stabilize the market and avoid speculation and price manipulation.