Shrimp processed for export at a Minh Phu Group facility.
Several international institutions have revised down Vietnam’s economic growth forecast for 2025, lowering it from around 7 per cent to between 6 and 6.2 per cent, citing global policy uncertainty and weakening exports in the face of escalating trade tensions.
The Organisation for Economic Co-operation and Development (OECD) now projects Vietnam’s GDP to expand by 6.2 per cent in 2025 and 6 per cent in 2026.
Despite the downward revision, Vietnam remains one of the most promising economies in the region, with growth prospects still outpacing those of its regional peers, driven by strong private consumption and robust public investment, the OECD noted.
However, the report warned that a volatile global trade environment is likely to dampen overall momentum.
The OECD said Vietnam’s fiscal policy would continue to support growth through accelerated public investment, though it flagged emerging inflationary pressures that could lead to a more neutral fiscal stance.
Since June 2023, the State Bank of Vietnam has maintained an expansionary monetary policy, including interest rate cuts and set credit growth targets. While this trend is expected to continue, the OECD cautioned that upcoming hikes in pensions and minimum wages could fuel inflation and require careful policy management.
Meanwhile, in a recent report on the Vietnamese economy, Singapore-based United Overseas Bank (UOB) highlighted a notable depreciation of the Vietnamese dong following the United States’ announcement of new reciprocal tariff measures in early April.
While the State Bank of Vietnam may consider further monetary easing, concerns about exchange rate stability remain.
UOB expects the central bank to hold its refinancing rate steady at 4.5 per cent. However, a return to pre-pandemic levels of 4 per cent or lower could be possible if the labour market weakens and the foreign exchange market stabilises, the bank said.
UOB has also revised its 2025 growth forecast for Vietnam to 6 per cent, down from a previous estimate of 7 per cent.
