Vietnam economy expands 8.39% in Q2, H1 growth hits 8.18%

Vietnam's GDP grew an estimated 8.39% in Q2 from a year earlier, lifting H1 economic expansion to 8.18%.

The H1 growth rate exceeded the 7.63% recorded in the same period last year, the National Statistics Office said on Friday.

Industry, construction and services remained the main drivers of growth. The industrial and construction sector benefited from stronger growth momentum, a recovery in export orders, and positive spillover effects from public investment.

The industrial sector's value rose 9.86% in H1 year-on-year, contributing 40.35% of total economic growth. The services sector, including trade and transport, expanded 8.09% as stronger consumer spending, goods circulation and travel supported activity.

Agriculture, forestry and fisheries expanded 3.57%, supported by continued enlargement of agricultural export markets.

Given the GDP figure for H1, the government has set a target of 11.9% economic growth in Q2 to achieve its goal of expanding GDP by at least 10% for the full year, according to a government resolution issued on June 27.

The target was outlined in Resolution 168, which updates the country's growth scenario and sets out key policy measures for the remainder of the year while maintaining macroeconomic stability. Previously, on April 24, the National Assembly - the country's legislature - set a 2026-2030 agenda targeting at least 10% average annual GDP growth.

Nguyen Thi Huong, head of the National Statistics Office, said the H1 performance was positive despite continued global economic and geopolitical uncertainty. She noted Vietnam's macroeconomic fundamentals remained stable, inflation was kept under control, supplies of essential goods were sufficient, and domestic consumption and tourism continued to recover.

However, Huong warned that Vietnam's highly open economy remained vulnerable to external shocks in H2. "Achieving double-digit growth for the full year remains a significant challenge given the economy's high degree of openness and exposure to external developments," she said.

She recommended that authorities manage fuel prices flexibly, avoid simultaneous increases in state-administered prices to ease inflationary pressures, accelerate public investment disbursement, stimulate domestic consumption, and expand export markets.

Trade deficit hits $16.65 billion in H1

Vietnam posted an estimated trade deficit of $16.65 billion in H1, reversing a $7.95 billion trade surplus in the same period last year. Total trade reached $549.7 billion, with exports and imports rising between 21% and 37.3% from a year earlier.

The United States remained Vietnam's largest export market, with outbound shipments totaling $86.5 billion, while China was its biggest source of imports at $115.2 billion.

39.4% of firms surveyed expect conditions to improve further in Q3

A survey of manufacturers showed improving business sentiment, with 36.3% of firms reporting better business conditions in Q2. The proportion expecting conditions to improve further in Q3 rose to 39.4%.

The National Statistics Office said around 169,800 businesses were newly established or resumed operations in H1, averaging 28,300 per month. During the same period, about 151,100 businesses suspended operations or exited the market, equivalent to 25,200 per month.

Average consumer prices increased 5.25% in Q2 from a year earlier. For the first six months, the consumer price index (CPI) rose 4.38%, while core inflation increased 4.12%.

The S&P Global Vietnam Manufacturing Purchasing Managers' Index posted 51.8 in June, down from 52.8 in May but still above the 50.0 no-change mark, reflecting an improvement in the health of the sector.

Business conditions have now strengthened on a monthly basis throughout the past year, S&P Global stated in a release on July 1.

Output rose for the 14th successive month, and at a marked pace that was the fastest since February. Higher new orders and rising output requirements encouraged manufacturers to expand their purchasing activity for the second month running in June.

But continued supply-chain delays meant that stocks of inputs fell sharply. Staffing levels were also down amid ongoing evidence of spare capacity in the sector.