Vietnam's GDP expected to expand 7.2% in 2022: World Bank

After lockdowns caused by COVID-19 in the third quarter of 2021, Vietnam’s economy quickly recovered and grew by 6.4 % in the first half of 2022. In July 2022, inflation jumped slightly to 3.1 % year-on-year.

Vietnam’s economy has rebounded strongly, but its recovery remains incomplete, with aggregate output remaining below pre-covid trends.

In the near term, policymakers confront the difficult task of balancing the need for continued policy support to solidify the recovery in the context of weakening global environment with the need to contain emerging inflation and financial risks, said the organisation.

"In the medium to long term, achieving Vietnam’s goal to become an upper-middle income economy will depend on transitioning to a productivity and innovation-led growth model based on a more efficient use of productive, human, and natural capital."

This transition requires strengthened institutional capacity to pass and implement structural reforms aimed at building a more competitive and resilient economy. 

However, the primary trading partners of Vietnam's economy are slowing down, inflation is rising, and financial risks are rising, all of which represent greater economic downside risks.

The difficult task of balancing the need for ongoing policy support with the need to manage emerging inflation and financial risks is a challenge that Vietnamese policymakers must solve. 

Vietnam's shift to a productivity- and innovation-led growth model will be crucial in the medium to long term for the country to reach its ambition of becoming an upper-middle income economy.

Outside of China, much of East Asia and the Pacific have seen growth thanks to increased exports and a resurgence in domestic demand made possible in 2022 by the easing of COVID-related restrictions.