Vietnam manufacturing index grows strongest in a year

A panoramic view of Ho Chi Minh City at sunset. Photo courtesy of the government's portal.
The S&P Global Vietnam Manufacturing Purchasing Managers' Index (PMI) rose to 54.7 in May from April's six-month low of 51.7, marking the eighth straight month of expansion and the strongest growth since April 2021.
This demonstrated that Vietnam’s production and business conditions have improved at the best level in more than a year, IHS Markit, an information services provider under S&P Global, noted in a report.
A reading above 50 indicates an expansion of the manufacturing sector compared to the previous month; below 50 represents a contraction; while 50 indicates no change.
In particular, output recorded the strongest and fastest growth rate in the last 13 months owing to a considerable rise in new orders as demand improves post-pandemic.
Export orders retained strong growth despite the effect of China's zero-Covid policy, driving up May's output. This has prompted manufacturers to increase recruiting for the second straight month, and at a solid pace that proved the fastest in 13 months.
Meanwhile, purchasing activity rose in response to new orders growth, with the rate of expansion quickening to a three-month high. Given the strong and rapid increase in new order output, stocks of input items fell for the second month in a row. Finished product inventories also fell, marking the second substantial drop in the last 10 months.
The consumer price index's growth rate slowed in May, with both input costs and output prices growing at the weakest rate in three months. However, rising oil and gas prices, as well as shipping charges, have forced enterprises to pass the pricing burden to customers by boosting selling prices, according to IHS Markit.
Delays in raw material delivery have worsened since last month due to China's stringent embargo, and supply chain disruptions are ongoing issues for the enterprises.
Looking ahead, business confidence strengthened for the second consecutive month, and reached its highest level since January, supported by optimism in the outlook for production, the report added.
Credit rating agency S&P Global Ratings in late May revised up Vietnam’s long-term sovereign credit rating to BB+, a "stable" outlook. Vietnam is one of only two economies in the Asia-Pacific region to have been upgraded since the beginning of the year, the other being Taiwan.
The S&P’s upgrade was based on Vietnam’s steady economic recovery prospects following the progressive lift of domestic and cross-border mobility restrictions, outstanding improvement in vaccination rates, and flexible shift in Covid-control policy.
The agency predicted Vietnam's real GDP growth of 6.9% in 2022, with a long-term trend of 6.5-7% from 2023 onward.
ADB predicted that Vietnam's economy would improve in 2022, with growth reaching 5.5-6% and maybe higher in 2023. However, inflation is expected to rise substantially, probably to 3.8-4.2% in 2022 and maintain at 4% in 2023.
World Bank in April lowered Vietnam’s 2022 GDP projection to 5.3% due to challenges in terms of rising Covid-19 infections and the country’s vulnerability to external shocks driven by its high economic openness. This estimation is much lower than that of other international institutions.
The PMI measures the performance of the manufacturing sector and is derived from a survey of 400 production companies. The Index is based on five individual indexes with the following weights: New Orders (30%), Output (25%), Employment (20%), Suppliers’ Delivery Times (15%) and Stock of Items Purchased (10%), with the Delivery Times index inverted so that it moves in a comparable direction.
- Read More
What makes NobleGo - Vietnam’s first home-bidding livestream platform - so notable?
NobleGo – Vietnam’s pioneering AI-powered livestream real estate bidding platform developed by Sunshine Group – has completed its first 20 livestream sessions.
Real Estate - Tue, September 16, 2025 | 4:53 pm GMT+7
Japanese retailer Aeon to debut another northern Vietnam shopping mall by end-2026
Japanese-backed Aeonmall Vietnam is ramping up construction on its Aeon Mall Ha Long project in Quang Ninh province, home to Ha Long Bay, with an aim to open it to the public by end-2026.
Industries - Tue, September 16, 2025 | 3:54 pm GMT+7
Hanoi terminates Vinaxuki auto plant project, repurposes land for commercial complex
A long-stalled automotive manufacturing project by Xuan Kien Auto JSC (Vinaxuki) has been officially terminated by Hanoi authorities, and the reclaimed land in Phuc Thinh commune will be repurposed for a new commercial and service complex.
Industries - Tue, September 16, 2025 | 2:44 pm GMT+7
Central Vietnam province reviews investment proposal for thermal power project after Thai EGATi pullout
Authorities in the central province of Quang Tri are evaluating a proposal from Power Generation JSC 1 (EVNGENCO 1), a subsidiary of state utility Vietnam Electricity (EVN), to take over the Quang Tri thermal power plant project, following the withdrawal of Thai investor EGATi.
Energy - Tue, September 16, 2025 | 1:44 pm GMT+7
Amata to sell stakes worth $46 mln in Vietnam units to Novaland-tied buyers
Amata VN, the Vietnam arm of Thailand’s leading industrial park developer Amata, has approved a plan for its subsidiary Amata City Long Thanh Urban JSC (ACLT) to sell its remaining 51% stakes in two entities to local developer Novaland-linked buyers.
Real Estate - Tue, September 16, 2025 | 12:19 pm GMT+7
Vietnam already meets FTSE's criteria for stock market status upgrade: Finance Minister
Vietnam has fulfilled the criteria for a stock market status upgrade by FTSE Russell through reforms aimed at facilitating foreign investment inflows into its market, said Minister of Finance Nguyen Van Thang.
Economy - Tue, September 16, 2025 | 9:36 am GMT+7
Banks should be allowed to distribute, invest in mutual fund certificates: Vietnam's finance ministry
The Ministry of Finance is proposing a key reform that would allow commercial banks to invest in and distribute mutual fund certificates, as part of a broader plan to restructure the investor base and foster the development of Vietnam’s fund management industry.
Finance - Tue, September 16, 2025 | 8:00 am GMT+7
E-commerce boom a major driver of Vietnam's packaging paper industry growth
Vietnam's paper packaging industry is entering a period of strong growth, with an average annual growth rate forecasted at 10% until 2030.
Companies - Mon, September 15, 2025 | 10:20 pm GMT+7
Vietnam needs support from UK in developing international financial center: Deputy PM
Permanent Deputy Prime Minister Nguyen Hoa Binh has called on the UK and the City of London to continue supporting and accompanying Vietnam in promoting and introducing its international financial center (IFC).
Finance - Mon, September 15, 2025 | 10:12 pm GMT+7
Vietnam enforces 8% capital adequacy ratio for banks from Sept 15
Commercial banks and foreign bank branches in Vietnam must maintain a minimum capital adequacy ratio (CAR) of 8%, including at least 4.5% in Tier 1 core capital and 6% in Tier 1 capital, starting from September 15.
Banking - Mon, September 15, 2025 | 10:04 pm GMT+7
Tool for wood traceability management debuts in Vietnam
The Vn-WoodID application has been officially launched in Vietnam, becoming a key tool contributing to wood traceability.
Companies - Mon, September 15, 2025 | 10:00 pm GMT+7
Sun Group, US Embassy foster aviation-hospitality cooperation
Sun Group, in collaboration with the US Embassy in Vietnam, hosted the US – Vietnam Aviation Partnership Roundtable on September 12, bringing together 15 leading American corporations in aviation, technology, and financial services, opening up opportunities to position Phu Quoc as a new aviation and tourism hub in the region.
Companies - Mon, September 15, 2025 | 9:54 pm GMT+7
Vietnam tops Thai giant SCG’s overseas markets with 9% revenue contribution in H1
Vietnam remained the largest overseas market for Thailand’s Siam Cement Group (SCG) in the first half of 2025, contributing 9% of consolidated sales.
Companies - Mon, September 15, 2025 | 8:10 pm GMT+7
Central Vietnam to have new airport Mang Den
Procedures to adjust Vietnam's airport system planning, including the addition of Mang Den Airport in central Vietnam, are being proceeded, according to the Ministry of Construction.
Infrastructure - Mon, September 15, 2025 | 5:16 pm GMT+7
Vietnam's government seeks to position country as 'regulated hub for digital assets in Asia': Dragon Capital
The Vietnamese Government has advanced the regulation of digital assets, with a resolution launching a five-year pilot framework for issuance and trading. This framework signals the Government’s intent to position the country as a regulated hub for digital assets in Asia, which could attract new capital inflows, write Dragon Capital analysts.
Economy - Mon, September 15, 2025 | 2:20 pm GMT+7
Agribank introduces sizable $4.17 bln preferential credit package
Right from the beginning of 2025, Agribank launched a substantial preferential credit package worth VND110 trillion ($4.17 billion) to support individual customers.
Companies - Mon, September 15, 2025 | 1:32 pm GMT+7