I visited Vietnam’s capital Hanoi recently, conducting meetings with the International Monetary Fund (IMF), the State Bank of Vietnam and the Ministry for Planning and Investment, among others. In this Q&A, I highlight some key investment findings and elaborate on what surprised me most from this trip.
Why Vietnam, why now?
Vietnam ranks as one of the top two or three countries in Southeast Asia in terms of growth and investment potential.
The country’s population is still predominantly low-to-middle income with a nominal annual per capita GDP of around US$3,000, but it has an expanding middle class. Only 37% of the population lives in urban areas, compared to 65% in China. In addition, the country still has another generation of demographic growth ahead of it.
How do you view Vietnam’s potential in the broader emerging-markets context?
We believe Vietnam is favourably positioned within the emerging-markets (EMs) context for several reasons. First, while many EMs are struggling with weak growth and high inflation, Vietnam appears to be a positive outlier.
Real GDP is forecast to grow at around 6% per annum over the coming years according to agencies such as the International Monetary Fund (IMF). Although inflation is picking up, it is still moderate by global (and indeed regional) levels, owing to a high level of food self-sufficiency and some fiscal subsidies.