Vietnam's business climate, strategic position charm foreign investor: WB exec

Vietnam’s business environment and the Vietnamese government’s efforts are two of the three key factors that help the country attract foreign direct investment, according to Andrea Coppola, World Bank’s lead economist and program leader for Vietnam, Cambodia, and Laos.

In an interview with the Vietnamese government's news portal, Coppola stated that, like many other countries, Vietnam has faced challenges in 2024 related to international geopolitical tensions, climate change, and natural disasters.

“Vietnam’s economy in 2024 has achieved very positive results due to increased demand from major export partners such as the EU and the U.S., leading to a robust recovery in exports and industrial production, alongside a gradual revival in domestic consumption. We anticipate this positive growth trend will continue into 2025,” said Coppola.

Coppola emphasized three primary factors attracting foreign investment to Vietnam.

Firstly, Vietnam’s business environment offers stability, a particularly critical factor for investors. Secondly, the international community highly values the Vietnamese government’s continuous efforts to enhance the business climate.

Thirdly, Vietnam has capitalized on its strategic position as a “bridge” between major powers like China and the U.S, enabling it to attract significant foreign investment.

To further strengthen its competitive edge, Coppola suggested the country focus on three key areas, including enhancing workforce skills and expertise; upgrading transport and energy infrastructure, including clean energy, to reduce the carbon intensity of export products; and fully utilizing existing trade agreements and minimizing non-tariff barriers to boost trade and investment flows.

According to Coppola, the WB’s latest economic forecasts predict Vietnam will maintain strong growth in 2025, with an expected GDP growth rate of around 6.5%. This would place Vietnam among the fastest-growing economies in East Asia and globally.

While trade will remain the primary driver of economic growth, export growth may moderate compared to 2024 due to a potential slowdown in demand from major global economies like the U.S. and China.

However, a sustained recovery in domestic demand, driven by improved investor and consumer confidence, is expected to support Vietnam’s economic expansion, Coppola added.