Ho Chi Minh City's economy showed positive momentum in the first five months of the year, supported by strong domestic consumption, rising foreign investment and improving industrial production.
Panoramic view of Ho Chi Minh City (Photo: CP).
According to the city's Statistics Office, manufacturing and trade activities continued to expand thanks to businesses' adaptability and the effectiveness of government support measures and consumer stimulus programmes.
The city's Index of Industrial Production (IIP) rose 11 per cent year on year during the period. The manufacturing and processing sector remained the main growth driver, increasing nearly 12 per cent.
Meanwhile, the city's four key industrial sectors, including mechanical engineering, electronics, pharmaceuticals and chemicals, rubber and plastics, and food and beverage processing, recorded growth of more than 13 per cent, outperforming the overall industrial sector by 2.4 percentage points.
Total retail sales of goods and consumer service revenue reached VND 799.9 trillion (approximately USD 30.7 billion) in the first five months, up 13 per cent from a year earlier. Retail sales accounted for the largest share and increased 16 per cent, with sales of precious stones and precious metals surging 49.3 per cent. Consumer promotion campaigns and stimulus programmes continued to boost domestic spending.
The city also recorded 24,784 newly established businesses during the period, with total registered capital of VND 151.6 trillion (approximately USD 5.8 billion), up more than 29 per cent and 26 per cent respectively compared with the same period last year.
Foreign investment inflows exceeded USD 3.8 billion, with capital contributions, share purchases and stake acquisitions accounting for USD 2.33 billion of the total.
State budget revenue reached an estimated VND 401.9 trillion (approximately USD 15.4 billion), fulfilling nearly 50 per cent of the annual target and increasing 24.3 per cent year on year.
However, public investment disbursement remained below expectations. As of May 21, the city had disbursed VND 23.6 trillion (approximately USD 906 million), equivalent to about 16 per cent of the capital allocation approved by the Prime Minister.
Authorities attributed the slow pace mainly to delays in compensation and land clearance for major infrastructure projects, including Ring Road 2, where site clearance has reached only about 61 per cent. The city aims to complete the eastern section of Ring Road 2 by 2028.
Rising construction material costs, driven by geopolitical tensions in the Middle East since late February, have also affected project progress. Higher fuel prices increased the cost of quarrying, transporting construction materials, operating equipment and labour, placing additional pressure on contractors.
Shortages of imported asphalt and asphalt concrete have further constrained construction activities.
Despite these challenges, authorities expect conditions to improve from June as fuel prices stabilise and material supplies recover, helping projects make up for delays recorded earlier in the year.
