The city Statistics Office reported that the city’s gross regional domestic product (GRDP) was VND360.62 trillion in Q1 2023 if calculating current prices.  The figure would be VND246.931 trillion if calculating 2010 comparative prices, a modest increase of 0.7 percent compared with the same period last year.

The growth rate is low if noting that the GDP of the entire country grew by 3.32 percent during the same time. 

HCM City, which is called the economic locomotive of Vietnam, ranked 56th out of 63 local economies and the lowest among 5 centrally run cities. 

The growth rates were 9.65 percent for Hai Phong, 7.12 percent for Da Nang, 5.8 percent for Hanoi and 4.02 percent for Can Tho.

Commenting about HCM City’s economic performance in the last three months, Tran Du Lich, a member of the National Advisory Council for Financial and Monetary Policies, said this was the first time since 1982 that HCM City was at a "red light".

According to the HCM City Institute for Development Studies, the city was just above seven other provinces in economic growth in Q1, which meant it ranked 56th out of 63 cities and provinces.

The institute pointed out that except for the budget collection of VND124.796 trillion, 26.6 percent of the yearly estimate, other indexes showed sharp decreases.

Public expenditures dropped, and trade and service growth declined because of weak domestic demand, while exports plunged as global demand weakened. 

The ratio of society’s investment capital to GRDP was on the decrease. The industrial production index fell and the real estate index dropped by 54 percent compared to early 2022.

According to the institute, there were three reasons:

First, the Tet holiday fell in Q1, when production activities paused, spending was low, and people tightened their pursestrings.

Second, the international arena is complicated (war, global inflation, tightened monetary policy, crisis of the banking system in Europe and North America), lowering Vietnam’s and HCM City’s exports.

Third, the central government’s move to reorganize the financial and banking sector and corporate bonds affected many trade and service sectors, especially real estate.

Other causes included the slow disbursement of public investment in Q1 (4 percent).

The efficiency of public service performance of the city was low, leading to congestion in paperwork.

Third, the city’s growth in key sectors reached critical points. Fourth, there were problems in policies beyond the city’s jurisdiction.

Tran Thuong