Vo Tri Thanh, director of the Institute for Brand and Competitiveness Strategy, said the goal of 6.5 percent in the GDP growth rate in 2021-2025 is challenging. However, Vietnam’s economy is now at a turning point towards transformation, and if efforts in policy and reform succeed, the economy will accelerate.

The turning point can be seen in the increase in the non-production sector’s contribution to GDP in recent years.

Pointing out positive factors in the market, the economist believes that the risks of regression faced by Vietnam’s largest trade, finance and investment partners have declined, while inflation is decreasing, which will ease pressure on monetary policy. 

Meanwhile, Vietnam is witnessing the trend toward a digital economy, green economy and hi-tech application.

Notably, Vietnam still maintains operating interest rates, and the finance and monetary situation is better, while the dong/dollar exchange rate, though fluctuating, is within control.

Another positive factor is the strong rise in exports, with the processing and manufacturing industry returning to serve as the driving force for growth.

According to chief economist of BIDV (Bank for Investment and Development of Vietnam) and member of the National Advisory Council of the Finance and Monetary Policies, Can Van Luc, there are seven supporting factors for Vietnam’s economy.

The situation is expected to get better in 2024-2025 for Vietnam. The financial obligations have gone through the most difficult period, and capital access has been maintained.

Meanwhile, legal problems are being gradually resolved, while institutions are being perfected. Consumer confidence has been restored, though the process is going slowly. It has become easier to mobilize capital and resources for business. Enterprises now can borrow money at lower interest rates, while market liquidity is getting stronger.

According to experts, businesses and individual investors all need to define risks and use risk management methods.

Interest rates falling

Bui Quang Anh Vu, CEO of Phat Dat Real Estate Development, said he has confidence in a new development cycle of the economy. With new policies set by the government, he believes that real estate remains a good investment channel.

A report released by CBRE Vietnam about the yield of investment channels shows that from December 2019 to March 25, 2024, stock prices increased by 22 percent and gold by 17 percent, and profit from apartment leasing was 5 percent.

Duong Thuy Dung of CBRE Vietnam said for investment companies, commercial real estate and Industrial Zone development remain their preference.

As for individual investors who are interested in housing products, mid-end products are receiving the most attention, because they are not too expensive and there is still space for prices to continue to increase. 

CBRE reported that price increase of projects in the secondary market in the first quarter of 2024 was 10-45 percent, while prices of mid-end apartments increased by 35-40 percent.

Regarding the stock market, La Gia Trung, CEO of Passion Investment, said that the market is in good condition though the macroeconomy is facing difficulties. At the beginning of the year, Trung predicted that the VN-Index would hit a peak of 1,500 points this year.

The VN-Index is valued at lower average level, with a P/E of below 15x. In 2018-2022, the P/E was always over 20x. The interest rate is even lower than that in Covid-19 period. These are all the supporting factors for the market.

While many stock markets in the world have reached new peaks, the Vietnamese market remains at a low level.

“I think that 2024 is a good year for the VN-Index to climb to 1,500 points and it may reach a new peak area thanks to good supporting factors,” Trung said.

Manh Ha