UK expert optimistic on Vietnamese economic prospects

Huntley said that despite the growth rate not being as high as that recorded in 2022, it will still be equivalent to the strong growth that the country recorded in the period before the outbreak of COVID-19 back in 2019.

Assessing economic growth last year, the UK expert said that with an increase of 8.02%, among the highest in the world, the nation has witnessed a strong recovery after two years of being negatively impacted by COVID-19 outbreaks. Gross domestic product (GDP) only grew at 2.5% to 3% due to the impact of the pandemic, anti-pandemic measures, as well as other unusual factors that caused the growth of the tourism, industrial production, and export industries to fall sharply.

Huntley stated that the driving force behind the recovery was an increase in consumption standing at about 14%, a high growth rate, and a major contributor to GDP growth exceeding 8%.

Not only has domestic consumption increased sharply, exports in 2022 also recovered similarly with an increase of 13%, of which exports in the manufacturing sector contributed the most and were the primary driving force.

In addition to the post-pandemic recovery, the nation also saw other positive factors, such as the signing of new trade agreements with the EU, the UK, and Canada, which contributed significantly to the strong growth last year.

Regarding opportunities and challenges ahead in 2023, Huntley stated that despite not returning to pre-pandemic levels, international tourism to the Vietnamese market, as well as domestic tourism, has shown signs of recovery in 2022. Indeed, prospects will be much better this year, a positive point that will ultimately contribute to promoting economic growth in 2023.

According to the expert, foreign direct investment will also play a significant role the in Vietnamese economy this year, particularly as the nation’s position is enhanced in the selection list of international investors.

In the M&A area, many financial businesses and investors see the country’s position in the Southeast Asian region as a prime opportunity for them. In order to continue promoting growth, Huntley recommended that the Vietnamese Government focus on tackling the ineffectiveness of the central and local administrations in a bid to ensure all investment programmes and projects receive suitable support.

Simultaneously, the nation should increase programmes in order to introduce its strengths to the wider international community, thereby not being limiting to areas of agriculture and tourism, but also in fields needing sustainable investment such as environment, climate change response, the use of farming land, and the impacts of climate change on rivers and forests.

However, the BDA leader also pointed to the numerous challenges facing the Vietnamese economy this year, in which the biggest drag is the uncertainties surrounding the global economy.

He explained that as a major exporter, the country is still heavily dependent on the global economy. Another challenge is the double pressure of inflation and interest rates amid the nation still being heavily dependent on imported raw materials and energy, while the cost of these items has increased significantly and can be higher, thereby affecting production activities as well as the overall competitiveness of the manufacturing industry.

Despite these challenges, Huntley remains optimistic about Vietnamese prospects in the medium term, saying that the country has many basic attractive factors supporting growth over the coming years.

Huntley is one of the three CEOs and co-founder of BDA Partners. Currently, he is in charge of life sciences and global healthcare with his office based in Ho Chi Minh City. Earlier, he was also involved in the establishment and management of BDA's first offices located in Asia.