| This is a copy/paste from an email I (and many others) received from Richard Burrage at Cimigo. I wanted to share this with you not because I’m a Cimigo agent but because Richard and his staff do good work. I always learn something from these reports. Peace, MAA Dear Mark, As we look ahead to the next decade, Vietnam’s economic future is bright and full of promise. Powered by a robust industrial base, growing affluence, and a thriving digital economy, the country is poised for continued rapid transformation. This edition explores the eight key drivers set to fuel Vietnam’s growth and opportunities. Let’s dive in! (Note: Cimigo is a well-known market research company.) |
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| Vietnam’s economic growth stays strong. Vietnam’s economy continues to grow at an impressive rate. Over the past decade, GDP has increased by an average of 5.8% annually. This momentum, supported by resilient manufacturing and foreign direct investment (FDI), sets the stage for sustained economic progress. Vietnam moving up the global value chain. Vietnam is transitioning towards more sophisticated production and exports. In 2023, 40% of its exports were high-tech products, up from just 4% in 2003. The country’s deepening integration into global supply chains, aided by 16 free trade agreements, is a powerful growth driver. Vietnam’s tourism sector is thriving again. Tourism has bounced back. Domestic travel is booming, and international tourism saw a 43% surge in 2024, with 12.7 million visitors year-to-date. But what’s different now is the demand for wellness tourism and solo travel, driven by a desire for personalised, meaningful experiences. Wellness retreats and nature-focused tourism are becoming mainstream, while digital nomads and social media influencers are fueling the rise of solo travel. Changing consumer retail landscape. While retail demand is still recovering, consumer behaviour has shifted dramatically. Goods sales grew by just 1%, while services were up 8%. Inflation and cautious spending habits are driving an increase in household savings, with retail bank deposits up 4.7% this year. Consumers focus more on value, and the demand for premium goods has slowed. As households opt for thrift over premium-value purchases, businesses need to sharpen their value propositions. Rising affluence shaping Vietnam’s middle class. Vietnam’s middle class now represents 56% of households. 15.8 million households with a monthly income above $592. These wealthier households spend more on education, health, and leisure, reshaping the consumer landscape. As an example, $5.1 billion is being spent this year on educating Vietnamese children overseas. |
| Is Vietnam on the path to becoming a cashless society? Yes! Vietnam is rapidly transitioning towards a cashless economy, with nearly 40% of all transactions now happening via mobile banking apps. Fintech innovation and digital payments are redefining how consumers interact with businesses. For example, Buy-Now, Pay-Later (BNPL) transactions surged 113% in 2023. Vietnam’s digital economy is powering growth. Vietnam’s digital economy has skyrocketed to $30 billion, contributing 7% of the country’s GDP. E-commerce platforms like Shopee dominate the market, but challengers like TikTok are gaining ground through social commerce. Online shopping is the biggest driver of Vietnam’s digital economy. Live-streaming and interactive shopping experiences are transforming how people shop online. Vietnam’s demographic advantage is boosting the economy. Vietnam enjoys a significant demographic dividend, with 62% of the population being of working age and one of the lowest dependency ratios in the region – with only 0.64 dependents per employed person. Vietnamese women are the game changers in this advantage, as 88% of working-age women participate in the labour force – one of the highest rates in the region. This is the single most important key driver of productivity and economic growth. A decade of growth and opportunity. Vietnam’s economic transformation is in full swing, with dynamic growth drivers creating new business opportunities. Whether digital payments, the booming middle class, or evolving consumer behaviours, now is the perfect time to position your business for success in Vietnam’s fast-evolving market. At Cimigo, we specialise in helping businesses navigate these trends and make smarter, data-driven decisions. Reach out to us today for a complimentary consultation on how these trends can impact your business strategy. Email us at ask@cimigo.com or visit our website at www.cimigo.com. Many thanks, Richard (Burrage) |
An International Educator in Vietnam 