Domestic demand - mainstay of Vietnam's economic growth: ADB
Hanoi, October 1 (VNA) - Vietnam's economy remains resilient to increasing uncertainties and high US tariffs thanks to solid domestic demand, the Asian Development Bank (ADB) said in its September Asian Development Outlook (ADO).
The bank has also revised Vietnam’s economic growth forecast, raising it to 6.7% in 2025 and adjusting to 6.0% in 2026. Inflation projections are slightly below the previous estimates published in April this year.
Speaking at the launch of the report on September 30, ADB Country Director for Vietnam Shantanu Chakraborty said 2025 is a challenging year for the Vietnamese economy. The global economy has faced a major tariff challenge, with Vietnam facing some high tariffs due to its trade surplus with the US.
However, despite mounting headwinds from reciprocal tariffs and escalating geopolitical tensions globally and regionally, Vietnam’s economy has performed well in the first quarters of the year. Growth accelerated impressively to 7.5% by June 2025, marking its best first-half performance since 2010. This momentum was fueled by supportive government policies and a surge in export orders ahead of the new US tariffs.
However, ADB forecasts growth to slow down for the rest of this year due to the impact of reciprocal tariffs that took effect on August 7.
While the domestic economy remains stable, growth is expected to slow down compared to the strong growth in the first half of 2025. In addition to revising up its 2025 GDP growth forecast for Vietnam, the bank also forecast inflation will be lower, at 3.9% in 2025 and easing slightly to 3.8% in 2026.
Chakraborty said that better coordination between the effective enforcement of fiscal and monetary policies will help avoid overburdening monetary tools and preserve macro-financial stability.
He said in the long term, wide-ranging regulatory reforms must tackle structural challenges, like ensuring climate resilience, boosting the private sector's competitiveness, enhancing the efficiency of state-owned enterprises, stepping up the modernisation of the tax system, and digital transformation. This is vital for a more balanced growth model.
Nguyen Ba Hung, Principal Country Economist at ADB Vietnam, emphasised a number of risks stemming from both global uncertainties and domestic factors.
Particularly, he stated that Vietnam's economic outlook mainly faces external risks, first of all the reciprocal tariff measures of the US.
In addition, global uncertainties, including the slowing growth of major global economies, will affect the import demand of partner countries, leading to the fact that Vietnam's export activities will have less chances to maintain the high growth momentum as in the past.
Regarding domestic risks, Hung said that the implementation of the Government's reform efforts in the initial stage may encounter some adjustments, making the policies not as effective as expected.
Hung also stressed that if the government's reform measures are well implemented, they could contribute to better growth than ADB's forecast./.
