UOB raises Vietnam 2025 growth forecast to 7.7% on strong exports, FDI

In its Vietnam economic outlook report for the fourth quarter, released on Monday, the bank noted that Vietnam’s economic performance so far this year has exceeded expectations despite risks stemming from U.S. tariff policies.

The economy expanded 7.85 percent year on year in the first three quarters, supported by strong trade and manufacturing activity, keeping the full-year outlook positive.

In the third quarter alone, the country's GDP rose 8.23 percent from a year earlier, extending the strong 8.19 percent growth recorded in the previous quarter.

Building on the encouraging performance across multiple sectors in the January–September period, UOB maintained its growth forecast for the fourth quarter at 7.2 percent while revising its full-year projection upward to 7.7 percent.

The new estimate follows an earlier upgrade in September to 7.5 percent from 6.9 percent, marking the second upward revision in less than two months.

Supporting its revised projection, UOB noted that Vietnam’s exports rose 16 percent year on year in the first nine months, with shipments to the U.S. jumping 27.7 percent despite tariff headwinds.

Industrial production also expanded steadily over the period, posting a 10.8-percent increase from a year earlier.

The manufacturing sector’s Purchasing Managers’ Index (PMI) climbed above the 50-point mark for the third consecutive month in September, signaling a continued recovery in production activity.

The outlook was further strengthened by robust FDI disbursement, which totaled US$18.8 billion in the first nine months, marking an 8.5-percent jump from the same period last year.

If this momentum continues, total FDI for 2025 could approach the record $25.4 billion achieved in 2024.

However, UOB cautioned that Vietnam’s economy may face challenges toward the end of the year because of a high comparison base from late 2024 and ongoing trade tensions.

Given the country’s high degree of economic openness—with exports of goods and services accounting for 83 percent of GDP, the second-highest in ASEAN after Singapore (182 percent)—and its partial reliance on the U.S. market, the bank warned that export orders could start to taper off.

This may occur as U.S. companies have already placed early orders to avoid tariffs, while rising prices could curb American consumer demand.

Against this backdrop, the Vietnamese economy would need to grow at a brisk 9.7–10.5 percent in the fourth quarter to meet the government’s full-year growth target of 8.3–8.5 percent.