It's going to be a good year, according to a recent report.
VnExpress reports that Standard Chartered Bank expects Vietnam's economy to grow by 7.8% this year thanks to a strong rebound in manufacturing.
Tim Leelahaphan, an economist at the bank, told the news source: "The recovery is steady. In the last decade Vietnam's economic growth rate was one of the fastest and we expect this trend to [continue]."
In addition to manufacturing, Standard Chartered sees foreign investment as another major driver of growth, along with the service sector. Pledged foreign direct investment (FDI) fell by 25% last year as a result of the COVID-19 pandemic, but foreign companies pumped US$6.4 billion into in-progress projects, a 10.6% jump compared to 2019.
2021 is off to a good start in terms of FDI. For example, earlier this month a subsidiary of Foxconn, one of the largest producers of Apple products, received permission to build a US$270 million laptop and tablet plant in Bac Giang Province. Foxconn also plans to invest US$1.3 billion in Thanh Hoa Province, while Panasonic is expected to move home appliance manufacturing from Thailand to Vietnam.
Standard Chartered's outlook for 2021 is more upbeat than other institutions, though across the board Vietnam is expected to perform well this year in economic terms. The Asian Development Bank has forecast 6.1% GDP growth, while the International Monetary Fund sees 6.5% growth as likely — the latter is the same target set by the Vietnamese government.
In 2020, the economy expanded by 2.91%, the lowest rate in over a decade, due the widespread impacts of the pandemic, though this was one of the few positive growth rates recorded globally.
