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Vietnam to see world’s highest increase in wealth in next decade: report

Vietnam to see world’s highest increase in wealth in next decade: report

Friday, February 23, 2024, 09:00 GMT+7
Vietnam to see world’s highest increase in wealth in next decade: report
A production line of Mazda automobiles of Vietnamese automaker Thaco. Photo: Huu Hanh / Tuoi Tre

Vietnam is set to see the sharpest spike in wealth growth over the next decade as it cements its status as a global manufacturing hub, according to a report by global wealth intelligence firm New World Wealth and investment migration advisors Henley & Partners.

The country is forecast to see a 125-percent rise in wealth over the next 10 years, American pay television business news channel CNBC cited Andrew Amoils, an analyst at New World Wealth, as saying.

Vietnam is an increasingly popular manufacturing destination for multinational tech, automotive, electronics, clothing and textile firms, Amoils added.

The Southeast Asian country is perceived as a relatively safe country compared with other Asia-Pacific nations, which provides companies an extra incentive to set up manufacturing operations in the county.

A report from American management consulting firm McKinsey showed that Vietnam’s strategic location—sharing a land border with China and being close to major maritime trade routes, low labor costs, and infrastructure supporting exports have transformed Vietnam into a prime destination for international investment.

Vietnam’s 2023 GDP expanded 5.05 percent, lower than the 8.02 percent in 2022 due to dimmer global demand and stalled public investment. Manufacturing accounts for a quarter of the nation’s GDP.

Ten years ago, Vietnam’s GDP per capita was some US$2,190, which has surged to $4,100, according to the World Bank.

“Vietnam is developing rapidly and most of the population is benefitting,” Andy Ho, chief investment officer of VinaCapital Group told CNBC.

Ho added that Vietnam was benefitting from U.S.-China trade tensions.

Many multinational companies have been diversifying manufacturing to Vietnam, Ho noted.

As a result, foreign direct investment into Vietnam in 2023 soared 32 percent year on year. 

However, the prolonged global recession could impact consumer demand in developed markets, then affecting Vietnam’s manufacturing and exports.

Nevertheless, Vietnam would be able to navigate the challenges in future. It would take a lot to derail the country from its current track of growth, Ho said.

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Thanh Ha - Gia Minh / Tuoi Tre News


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