Speakers during the annual “Gateway to ASEAN” regional conference organised by UOB in HCM City on Friday. — Photo courtesy of UOB

HCM CITY — Despite potential risks, Việt Nam is regarded as one of the fastest-growing economies within the ASEAN region, serving as a crucial link to ASEAN and beyond, speakers said at a conference in HCM City on Friday.

Wee Ee Cheong, deputy chairman and CEO of United Overseas Bank (UOB) Singapore, said Việt Nam’s economy is expected to grow by 6 per cent this year, up from 5 per cent last year.

The country has great potential, driven by its youthful population, skilled workforce, and abundant natural resources, he said.

As a key member of ASEAN, Việt Nam is benefiting from shifts in the global supply chain and various free trade agreements, he added.

Victor Ngo, CEO of UOB Vietnam, said: “Việt Nam has emerged as a preferred destination for corporations seeking to diversify their manufacturing operations amid global instability, supply chain restructuring, and the ‘China+1’ strategy.”

Its strategic location, large and youthful population and favourable business policies, have made it an attractive investment destination, he added.

Heng Koon How, head of market strategy, global economics, and market research at UOB, said Việt Nam’s share of ASEAN’s GDP has nearly doubled, rising from under 6 per cent in 2000 to 12 per cent today.

Việt Nam's economic recovery in the first half is anticipated to persist into the latter half of the year, he noted.

Its GDP grew 6.9 per cent year-on-year in the second quarter, up from 5.8 per cent in the first quarter, he added.

“Despite potential risks, we maintain a positive growth forecast of 6.0 per cent for Việt Nam this year, up from 5 per cent last year,” he said.

With a burgeoning middle class and a population of some 100 million, consumer spending is expected to rise as wealth increases in Việt Nam, he added.

Việt Nam is also transitioning from low-cost manufacturing to higher value-added technologies while expanding its services, retail, and tourism sectors.

Phan Văn Mãi, chairman of the municipal People’s Committee, said that the growth rate for the ASEAN region is projected to reach 5 per cent this year, with Việt Nam’s growth expected at 6 per cent.

Việt Nam, including HCM City, will continue to create the most favourable conditions for foreign investors, particularly those from Singapore, with a focus on sectors such as finance, trade, and high technology, he said.

The southern economic hub has made efforts to streamline administrative reforms and foster an environment conducive to the operation of foreign enterprises within the city, he added.

“Singapore has emerged as Việt Nam’s fifth-largest trading partner and the largest foreign investor in HCM City,” he said.

ASEAN: a gateway for global trade

Ngo of UOB Vietnam said the ASEAN region is positioned as a crucial gateway for global trade, with Việt Nam as a key connector.

Despite global economic uncertainties since the COVID pandemic, ASEAN economies have shown resilience due to their collective strengths, he said.

Cheong of UOB Singapore said ASEAN is on track to become one of the world’s largest markets by 2030, supported by strategic connectivity, free trade agreements, and a growing middle class.

In 2022, while global FDI decreased, ASEAN’s inflows rose to a record $226 billion.

With a combined GDP of $3.6 trillion, ASEAN is expected to grow around 5 per cent this year, surpassing many developed nations.

However, challenges persist, including China’s uneven recovery, potential policy risks from leadership changes in key ASEAN countries, and uncertainty from the upcoming US presidential election, which could heighten trade tensions.

The annual “Gateway to ASEAN” regional conference, themed “ASEAN: Crossroad to the World,” was organised by UOB. — VNS