Why Vietnam

Vietnam Economic Indicators

 Vietnam GDP Growth in 2015


  • In the 2015 fiscal year, Vietnam’s economy grew by 6,68% . Average annual real GDP growth rate for the period of five years was 6% (source: GSO).

The structure of sectors contribution to general growth

  • The greatest contribution to the general growth is sector of industry and construction. This sector contribute proportion of 3,20% with growing rate of 9,64% higher than the point of 6,42% of previous year. In a while, the industry sector grow 9,39% compare to previous year ( industry of processing and manufacturing grow at 10,6%) construction sector grow at 10,82% , this is the highest growing rate from 2010. The service sector grow 6,34% contributing point of 2,43 %. The remaining sector of agriculture, forestry, fishery grow 2,41 %, lower than rate of 3,44% of 2014, contributing point of 0,4 % into general growth. This momentum is expected to continue in 2016/17 and later years (Vietnam Economic Outlook, 2035).


CPI (consumer price index)

  • In an effort to combat inflation, the government pursued a tight monetary policy, resulted in annual consumer price inflation of 0,63% in 2015; 1,84% in 2014 compared to 11,75% in 2010.


More other indicators:

Vietnam has young – structure population.

Age structure:


  • 0-14 years: 24.3% (male 11,946,656/female 10,800,602) 
  • 15-24 years: 17.8% (male 8,598,360/female 8,023,377) 
  • 25-54 years: 44.8% (male 20,983,638/female 20,861,243) 
  • 55-64 years: 7.4% (male 3,149,494/female 3,763,309) 
  • 65 years and over: 5.6% (male 2,034,721/female 3,260,435) (2014 est.) 

Population pyramid:

Medium age: 
total: 29.2 years 
male: 28.1 years 
female: 30.2 years (2014 est.)

>>The working-age population is measured at 42.3% of total population in 2014 according to World Bank>>

Import-Export of Vietnam 2014

Basically, huge fluctuations or changes have seen in imports and exports in general and in exports in particular of Vietnam in 2014, compared to the previous year.  This is the third consecutive surplus year of Vietnam, since joining the WTO, with export revenue reached more than US $ 150 billion.


Main exporters are FDI enterprises and exports revenue are mainly from traditional markets. The US, EU, ASEAN, Japan, and China remain the main export markets of Vietnam. Korean, Indian and Chinese markets are the three with the most significant changes and present the prospects for Vietnam's exports. In particular, the Korean and India markets develop in a positive way by enhancing trade promotion activities and tariff exemptions. On the contrary, China market tends to get worse due to the tensions in the South China Sea.


Exports are mainly originated from the FDI sector

Like the previous year, in 2004, FDI traders emulated domestic enteprises in exports. In situation where the world economy has not yet fully recovered, the demand for import is still limited in many countries, FDI enterprises tend to export better due to their advantages in the regards of markets availability in their home countries and the relationship / distribution channels in other foreign markets.


Although their main export products are processed, hand-made ones, CY 2014 was the third consecutive year when the export value of FDI accounted for over 60% of the total national exports revenue. For example, in the US, one of the largest export markets of Vietnam, statistics show that export products from Vietnam to the US market is mainly originated from FDI. Overall, the main export items of Vietnam (except agricultural ones) are mainly from FDI.


Comparison of export ratio between FDI enterprises and domestic enterprises (2010 – 2014)

Source: General Statistics Office (GSO)


In 2014, FDI enterprises are the far most exporters in electronic goods, footwear, machines, equipment and tools. Especially with electronic goods and telephones, almost 100% of exported products are from FDI enterprises. In 2014, the total export revenue of telephones nationwide reached over $23.6 billion, while FDI sector accounted for $23.5 billion. Nearly 100% of the exports value is from telephones and parts thereof group of Samsung Electronics Co. in Vietnam. CY 2014 was also the year that Samsung and other foreign investors shifted their production from China to Vietnam. Vietnam has become the country to receive the biggest direct investment from Samsung.


Comparison of the exports ratio of some commodities between FDI traders and domestic enterprises (2014)

Source: GSO


However, CY 2014 is the one that marked the first signals of better trends in general for domestic enterprises. For the first time in the 5 executive years, domestic enterprises surpassed the FDI traders in exports. For the whole year of 2014, exports of the FDI sector increased by only less than 10% compared to the same period last year, while that of the domestic enterprises presents 22.3%, up to nearly 36% (in 2014) from 33.2% (in 2013).

Maintain traditional markets

In 2014, there were no significant fluctuations in Vietnam’s market exports. Except for some new trends, the traditional markets such as the EU, ASEAN, the US, Japan and China remain the main export markets of Vietnam in 2014. These 5 traditional markets alone have accounted for three-quarters of the export value of Vietnam, whereas shipments of about 60 remaining market accounts for less than 30%.


Each major market such as the US and EU attracted almost 20% of Vietnam export value in 2014. At the same time, these two markets are also the ones of the greatest exports growth for Vietnam. A source from the American Chamber of Commerce in Vietnam (AMCHAM), exports revenue from Vietnam to the US market currently rank the first amongst the ASEAN countries. Although Japan is a small market but it is a major importer of Vietnam. With just over 120 million people, Japan imported from Vietnam a value of goods which is equivalent to that of China, a market of nearly 1.4 billion people.


Except for crude oil, these traditional markets (EU, ASEAN, the US) are interested in importing telephone and electronic goods from Vietnam.  EU, the US and Japan are interested in importing textiles, garment, footwear and seafood; and ASEAN, China import rice from Vietnam. In the regards of market concentration, about 40% of the export revenue of Vietnam rice is from the Chinese market and above 90% of total exports revenue of honey is from the US market.


Ratio of export markets in CY 2014

 Cropping up Korea market with great opportunities

the FTA with South Korea has made good progress and basically the negotiation process has come to completion, ready for the signing in early in 2015. Basically, Korea is committed to cut, relieve and give preferential tariffs for many major exported products of Vietnam, including shrimp, fish, tropical fruit, textiles, and started to open the market for highly sensitive products such as garlic, ginger, and honey.


In recent years, South Korea is a fast growing market for export and import with Vietnam. Growth rate of exports from Vietnam to the Korean market alone in the past five years is equivalent to that of the total to other large export markets such as Japan, ASEAN and China. With special complementary export structure as Vietnam and Korea market, free trade agreements will bring in significant enabling factors on exports promotion for Vietnamese enterprises to the Korean market, due to the fact that exported goods of Vietnam is not competed by local goods.


Growing exports to key markets

Source: GSO


Besides traditional markets like the US, EU, Japan and China, the main export items of Vietnam such as coffee, textiles, footwear, and seafood also attract Korean importers. Although the revenue of coffee, glass, shoes is low and are not classified in the 5 top revenue export commodities, response of Korean importers and the market in 2014 for these products of Vietnam proved to be very positive. Especially in 2014, the revenue of glass products from Vietnam to Korea has doubled.


The growth trend of the main export products to South Korea

Unit: 1.000USD

Source: GSO


Reduced tariff for a thousand of Vietnamese exports granted by India

India is one of the top ten leading trade partners of Vietnam. At the same time, the country also rates Vietnam as an important partner of the country in Southeast Asia. In 2013, Vietnam's exports to the Indian market increased by 60% and shifted from a deficit to a surplus. In 2014, the main export items from Vietnam to India in 2014 are  machines and tools, telephones and part thereof components.


In 2014, India applied tax reduction for thousands of export items of Vietnam to this market. Especially for items like pepper, coffee, rubber, tax has been reduced by 40-50%. Thus, in 2014, coffee exports from Vietnam to India increased by more than 36% and pepper exports doubled, while exporting of key products to this market is on the decline. With an increase of over 200% in volume, peppers ranked 7th from the 10th in terms of export value and promised to grow even further in the coming year.


Growth in exports to Indian markets

Unit: 1.000USD

Source: GSO


Calendar year 2014 witnessed no big changes in the key export products and markets of Vietnam. Vietnam retains a foothold in traditional markets as well as for traditional items. Phone products, textiles, footwear, electronics equipment, seafood remains the leading commodity for export revenue. However, pepper export has been cropped up as the most prominent goods. Vietnam continued to control the pepper market and is the greatest pepper exporter of the world in 2014. Exports revenue of pepper from Vietnam to most markets increased both in volume and value, compared with CY 2013.


In 2013, pepper was not in the merchandise group with revenue of over $1 billion. But in 2014, export value of Vietnam pepper has increased over 40% (mainly exported to the markets of the US, Singapore, the Unity of Arab Emirates (UAE), India and the Netherlands), putting the revenue of this commodity up to $1 billion. Specialists assessed this merchandise as a special strength of Vietnam in 2014. More importantly, it is promising for Vietnam to confirm its branding for this commodity to promote direct export in the following years.


Export revenue of pepper in 2013 – 2014

Unit: 1.000USD

Source: GSO


Besides, the demand for pepper in the world is in the trend to outstrip the supply. On the contrary to the general tendency of price decreasing in 2014, pepper was one of the few commodities with sharp price increasing in 2014. Therefore, although the export volume of Vietnam pepper increased by only 30% in 2014, the export value increased by 40% and according to preliminary calculations, farmers may get 70% by interest.

Source: GSO


Rice export value in 2014 increased compared to that of 2013 but this was due to the increase of average export prices (mainly thanks to the contract to export over 800,000 tons of rice to the Philippines), while the actual amount of exports of this goods decreased by more than 3% in the past year. In 2014, Vietnam's rice exports suffered fierce competitions, especially from that of Thailand. Thanks to good harvest, coupled with the weaker Thai currency (baht), in almost the whole CY of 2014, Thai rice prices on the international market is always cheaper than that from Vietnam, which rarely happened. Besides, Vietnam has difficulties in competing with India, Cambodia, Myanmar in many other markets.


Volume and value of rice exports in Vietnam (2013 – 2014)

Source: GSO



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