HSBC raises Vietnam's GDP growth forecast for 2024 to 7%

According to the HSBC Global Research Report, Vietnam has returned to being the growth "star" of ASEAN. Growth in the third quarter of 2024 reached 7.4% compared to the same period last year, higher than HSBC's forecast. This is the basis for HSBC Bank to raise its forecast for Vietnam's GDP growth in 2024 to 7%, instead of 6.5% as before.

HSBC raises Vietnam's GDP growth forecast for 2024 to 7%. Photo: Internet.

The recovery of the macro economy , and the early completion of budget revenue collection in some localities, is the clearest evidence that fiscal, monetary and other macroeconomic support policies have come into effect. According to economic experts, the end of the year promises to grow beyond expectations.

Hanoi and Ho Chi Minh City have so far contributed over 51% of the total national budget revenue. Of which, Hanoi contributed 25.93%, Ho Chi Minh City contributed 25.45%. According to statistics, in the first 9 months of 2024, Hanoi continued to lead the country in state budget revenue in the area with a total of 376,430 billion VND, reaching 92.1% of the estimate, up 22.2% over the same period. As for Ho Chi Minh City, in the first 9 months of 2024, it is estimated to have achieved 371,307 billion VND, reaching 76.9% of the estimate and up 14.3% over the same period. In Hai Phong City, the total budget revenue has reached over 82% of the estimate assigned by the City People's Council. In Khanh Hoa, the province's domestic revenue has reached 92.2% of the ordinance estimate and increased by 36.7% over the same period last year. Some localities have reached the "finish line" 3 months early in terms of state budget revenue, such as Da Nang, which has collected 100.7% of the 2024 estimate; Nghe An's state budget revenue reached 109% of the estimate, up 46% over the same period. Can Tho is close to reaching the finish line when its budget revenue reached 98% of the estimate. According to statistics from the Ministry of Finance , in 9 months, total state budget revenue has reached over 85%, almost reaching the estimate assigned by the National Assembly. Direct revenues from the 3 production and business areas (accounting for 50.9% of the total domestic revenue estimate) are estimated to reach 80.6% of the estimate, up 10.9% over the same period.

Source: HSBC

In some large localities, revenue from economic sectors increased, contributing to increased domestic revenue. For example, in Ho Chi Minh City, revenue from economic sectors increased significantly, contributing to an increase of 22.2% in domestic revenue. In particular, a 1.2% increase in revenue from import and export was recorded. With the significant contribution of the business community, Hanoi's budget revenue increased by 24.7% over the same period, estimated at 337.2 trillion VND, reaching 82.5% of the annual ordinance estimate. In Ho Chi Minh City, revenue from economic sectors increased by 24.7% over the same period, reaching 82.5% of the annual ordinance estimate. Hai Phong, revenue from import and export activities reached nearly 48,900 billion VND, an increase of over 14% over the same period in 2023. The above results were achieved thanks to the Government continuing to apply policies to reduce, extend and extend tax payment in 2024 for a number of taxes such as: Value added tax, corporate income tax, personal income tax, land rent, environmental protection tax and registration fees for domestically manufactured and assembled cars... to support and accompany taxpayers in the period of economic recovery after the Covid-19 pandemic.

According to the report "Vietnam at a glance - A class apart" by HSBC Global Research released on October 11, Vietnam has returned to being the "star" of ASEAN growth after a difficult year in 2023 and the first quarter of 2024. Growth in the third quarter of 2024 reached 7.4% year-on-year, higher than HSBC's forecast as well as other organizations. According to HSBC, this result continued to be led by manufacturing with a growth rate of 11.4% year-on-year; at the same time, it was reflected in positive trade data, in which exports in the third quarter of 2024 increased by 15.3% year-on-year. Encouragingly, the recovery in trade was initially concentrated in the electronics sector, but is now showing signs of spreading, in which textile and footwear exports increased by 16.7% year-on-year. HSBC experts said that although Typhoon Yagi is likely to dampen export growth in September, the impact is not expected to be long-lasting. According to HSBC, manufacturing sentiment was recorded as positive for the future outlook with underlying demand conditions remaining strong. Key indicators such as industrial production in the manufacturing sector and imports continued to record double-digit growth, reinforcing the view that the manufacturing sector will remain resilient. Regarding FDI, Vietnam continues to attract foreign capital flows. According to HSBC, capital flows into manufacturing are likely to remain stable in the future as the visit of General Secretary and President To Lam to the US has attracted interest from a number of companies such as Meta. Continuous efforts to strengthen relations with international partners will also create favorable conditions to attract more investment. With better-than-expected growth in Q3/2024, HSBC raised its GDP forecast for 2024 to 7%, expecting a stronger recovery and expansion across sectors in the coming quarters. HSBC kept its GDP growth forecast for 2025 unchanged at 6.5%./.

Le Quang