Việt Nam is among the world’s top wealth growth in the next decade

Friday, Feb 23, 2024 03:24

Việt Nam will see tremendous wealth growth over the next decade as the country consolidates its position as a global manufacturing hub. — Photo

Global wealth intelligence firm New World Wealth is predicting that Việt Nam will witness wealth growth of up to 125 per cent over the next 10 years, the largest wealth growth for any country in terms of GDP per capita and number of millionaires.

According to wealth analyst Andrew Amoils, Việt Nam is an increasingly popular production base for multinational technology, automotive, electronics and textile companies. Meanwhile, India, which is set to become the world's third-largest economy by 2027, ranks second with expected asset growth of 110 per cent.

Amoils added that with 19,400 millionaires and 58 billionaires, Việt Nam is considered a relatively safe country compared to other countries in the Asia-Pacific region. This strengthens the choice of companies considering Việt Nam as a top destination.

Explaining Việt Nam's success, strategic research firm McKinsey said that the country's strategic location, sharing a land border with China and near major maritime trade routes, low labour costs along with the country's export-supporting infrastructure have made the Southeast Asian nation a 'top destination' for international investors.

In its recent periodic assessment of the Vietnamese economy, the French Development Agency (AFD) said that Việt Nam has witnessed three decades of strong growth with an average annual growth rate of 7 per cent and belonged to the group of middle-income countries.

With many free trade agreements signed, the country has successfully positioned itself in the global value chain. Hervé Conan, Country Director of AFD in Việt Nam, gave a very positive assessment of the Vietnamese economy. Việt Nam has succeeded in maintaining an impressive growth rate despite high inflation that has affected many economies around the world.

In its periodic assessment of the macro economy every three years, conducted from the beginning of 2023, the AFD noted Việt Nam's encouraging successes in maintaining political and social stability and prudently implementing economic policies to ensure economic growth. The size of the domestic market with 100 million people is also an important advantage. The dynamism of national economic production is still maintained despite the years affected by the COVID-19 pandemic.

According to the World Bank, just 10 years ago, Việt Nam's GDP per capita was about US$2,190 and has now nearly doubled to $4,100. Việt Nam is developing rapidly and most people are benefiting.

Việt Nam's growth story has been propelled by export-led industrialisation, driven by three waves of foreign direct investments over the past three decades, and the country is on the precipice of a fourth wave, Maybank's Economist and Assistant Vice President Brian Lee said.

There are some headwinds that could stall Việt Nam's accelerating growth. The country's labour force will need more training to address the demands of the skill-intensive and complex production activities, Lee noted.

"More can be done to maximise the productivity spillovers from FDI, through closer collaboration between foreign companies and their domestic counterparts," Lee added. — VNS

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