Vietnam: Growth slows slightly in Q4 but remains rapid
The economy grew 7.0% in the fourth quarter of 2019, down from Q3’s revised 7.5% expansion (previously reported: +7.3% year-on-year). As a result, the economy grew 7.0% in 2019 as a whole, likely the highest reading in ASEAN.
The fourth quarter’s reading was driven by strong growth in manufacturing and services (+10.9% and +8.1% respectively), with the services sector likely benefiting from a surge in visitor arrivals and low unemployment. However, the agricultural sector appeared to remain hampered by the impact of African swine fever on pork production, expanding a mere 1.6% year-on-year.
Looking ahead, growth should remain well above the ASEAN average, supported by buoyant domestic demand, FDI, manufacturing and a blossoming tourism sector. However, the country’s open economy remains vulnerable to a synchronized global slowdown and possible U.S. tariffs.