Mitsubishi UFJ Financial Group (MUFG), one of Japan’s three core financial and banking institutions and among the world’s largest financial groups, has raised its forecast for Vietnam’s gross domestic product (GDP) growth to 7.7% in 2025 and 8.2% in 2026, up from 6.9% and 7.4% projected in August, the Vietnam News Agency has reported.
MUFG said the upward revision reflects stronger-than-expected export performance and resilient domestic growth drivers, while also warning of emerging risks related to rapid credit expansion and exchange-rate pressures.
In its report “Vietnam: Modest risk of overheating amidst very positive structural reforms”, MUFG noted that Vietnam’s exports in 2025 surged by nearly 17% year on year, well above initial expectations. Growth was broad-based, with electronics exports rising about 28% and machinery and equipment up 14%, highlighting Vietnam’s expanding role in regional and global supply chains. The bank attributed part of this momentum to exemptions for certain products, particularly electronics, from US reciprocal tariff measures.
However, MUFG pointed to growing divergence across sectors. Garment and textile exports slowed to around 7% growth in 2025 as of November, compared with 10% in 2024. November alone saw a marginal 0.1% year-on-year increase, reflecting pressure on labour-intensive industries amid weaker global demand and fiercer competition.
Foreign direct investment (FDI) remained robust, with realised FDI rising about 10% in 2025 and newly registered capital staying high, signalling continued foreign investor confidence in Vietnam’s medium-term outlook.
MUFG’s baseline scenario assumes Vietnam and the US will sign a formal trade agreement, improving certainty for investment and business activity, though the bank cautioned that negotiations could still face obstacles.
Beyond trade and investment, MUFG stressed that domestic demand and structural reforms remain key pillars of growth. Increased public infrastructure spending and efforts to restore private-sector confidence are expected to support internal demand. The bank described Vietnam’s current reforms as the most ambitious since 1986, gradually addressing long-standing structural bottlenecks.
At the same time, credit growth exceeding 19% year on year in 2025 could heighten overheating risks, especially as Vietnam targets GDP growth of 8.3–8.5% in 2025 and around 10% in 2026.
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