Vietnam is entering a pivotal stage of its development, with the launch of the Socio-Economic Development Plan for the 2026-2030 period and a long-term ambition of becoming a high-income developed economy by 2045. For the first time, the country has set a GDP growth target of 10 per cent, aiming to sustain double-digit expansion in the years ahead.
The goal is about more than faster growth. It signals a strategic shift toward a new development model driven by higher productivity, stronger competitiveness, and better-quality growth.
But double-digit growth is not simply about speed. It must be underpinned by macro-economic stability, effective inflation control, and stronger productivity, efficiency, and resilience across the economy. The objective is not growth at any cost, but rapid, high-quality, and sustainable expansion that lays the foundation for Vietnam’s long-term development.
Foundations already in place
Against this backdrop, Vietnam’s economic performance in the first half of 2026 is particularly significant. GDP expanded 8.39 per cent in the second quarter, bringing first-half growth to 8.18 per cent; the fastest pace in 15 years.
The expansion was supported by a broad-based recovery across all three major sectors of the economy. Agriculture, forestry, and fisheries grew 3.87 per cent, continuing to provide a stable foundation. Industry and construction expanded 9.81 per cent, led by manufacturing, which rose 10.23 per cent and remained the economy’s primary growth engine. And services increased 8.09 per cent, reflecting strong recoveries in trade, transportation, and, in particular, tourism.
From the demand side, all three traditional growth drivers strengthened. Final consumption rose 8.15 per cent, gross capital formation increased 15.2 per cent, and exports of goods and services climbed 20.18 per cent, pointing to improving domestic demand while exports continued to play a key role in driving growth.
Strong growth has also been accompanied by stable macro-economic fundamentals. Average consumer price inflation reached about 4.38 per cent in the first half, while core inflation stood at around 4.12 per cent, indicating rising price pressures that remained manageable. State budget revenue totaled VND1,568 trillion ($60.3 billion), equal to 62 per cent of the annual target and up 17.4 per cent year-on-year. Budget expenditure stood at VND1,149 trillion ($44.2 billion), or 36.4 per cent of the annual plan, leaving room for continued expansionary fiscal policy to support growth while maintaining social welfare commitments.
Investment remained one of the economy’s brightest spots. Public investment disbursement reached VND356 trillion ($13.7 billion), equivalent to 35.5 per cent of the annual plan and VND38 trillion ($1.5 billion) higher than in the same period of 2025. However, with this year’s public investment plan exceeding VND1,000 trillion ($38.5 billion), the figures also underscore the significant challenge of accelerating disbursement during the second half of the year.
Meanwhile, registered FDI totaled $34.65 billion, up 61 per cent, while disbursed FDI reached $13.03 billion, an increase of 11.2 per cent. Total social investment rose 12.9 per cent year-on-year. Together, these figures underscore the continued attractiveness of Vietnam’s investment environment and growing confidence among businesses and investors in the country’s economic outlook.
The first-half results are encouraging. More importantly, they suggest the economy is increasingly well positioned for a new phase of growth.
The progress reflects unified leadership from the Party, close coordination with the National Assembly, and decisive, flexible management by the government amid continued global economic uncertainty. Closer coordination between fiscal and monetary policy has helped preserve macro-economic stability, contain inflation, and stabilize money and foreign exchange markets. In turn, this has strengthened business and investor confidence while supporting the recovery across most sectors of the economy.
At the same time, first-half growth was largely driven by the simultaneous recovery of Vietnam’s traditional growth engines. Investment remained the leading contributor as total social investment increased nearly 13 per cent. FDI maintained positive momentum in both registered and disbursed capital. Large-scale infrastructure and energy projects moved forward, while several long-delayed strategic projects resumed implementation.
Exports remained a standout performer, growing by more than 21 per cent, while domestic consumption recovered steadily, supported by rising retail sales and consumer service revenue. Manufacturing continued to affirm its role as the economy’s most important growth driver, while services, particularly trade, logistics, transportation, and tourism, recorded strong gains.
Perhaps most significant has been the progress in institutional reform. The coordinated implementation of the Party’s major policies on private sector development, growth model transformation, science and technology, innovation, digital transformation, and administrative reform has not only helped remove longstanding bottlenecks but also begun to create new opportunities for growth.
These reforms are doing more than supporting short-term expansion. They are laying the groundwork for a new development cycle built on higher productivity, innovation, and more efficient resource allocation.
Together, these developments provide a strong basis for confidence in Vietnam’s growth prospects in the second half of 2026 while reinforcing the foundations for sustained double-digit growth in the years ahead.
Higher ambitions, higher expectations
Under the government’s current scenario, achieving the 10 per cent GDP growth target for 2026 will require the economy to expand by around 11.9 per cent in the second half of the year. It is an exceptionally ambitious target that will demand extraordinary efforts from the political system, the business community, and society as a whole.
But growth alone is not the objective. The second half of the year must deliver on three priorities simultaneously: sustaining growth of at least 11.9 per cent, keeping inflation within the National Assembly’s 4.5 per cent target while preserving macro-economic stability, and improving the quality of growth to lay the foundation for the 2027-2030 development period.
These priorities are closely linked. Pursuing rapid growth without maintaining macro-economic stability would increase the risks of inflation, financial imbalances, and weaker market confidence. Yet an overly cautious policy stance could cause Vietnam to miss opportunities as global supply chains continue to restructure and international investment flows shift.
Achieving these objectives will require addressing the key constraints that continue to weigh on growth. Despite strong economic performance, the quality and sustainability of Vietnam’s growth drivers remain a concern. The economy still relies heavily on foreign-invested enterprises, which account for nearly 80 per cent of total exports, while domestic firms remain only modestly integrated into global value chains. Strengthening the economy’s domestic capabilities therefore remains a priority.
Public investment has received strong policy attention, but disbursement remains uneven across ministries and localities. Weak project preparation, delays in land clearance, and cumbersome investment procedures continue to slow several major infrastructure projects. With public investment expected to crowd in private capital and expand productive capacity, these bottlenecks must be removed.
Businesses also continue to face significant headwinds. Many, particularly small and medium-sized enterprises (SMEs), still struggle to access financing as borrowing costs remain elevated. Weak asset markets point to a shortage of medium and long-term capital, while the corporate bond market has recovered only gradually. Meanwhile, policymakers have less room to ease monetary policy as inflation and exchange rate pressures persist.
Another emerging challenge is implementation capacity. Speaking at the government conference in early July, Party General Secretary and State President To Lam said Vietnam had largely resolved what he described as the “bottleneck of bottlenecks” - institutional reform - but now faced a new constraint: policy execution. In many areas, slow implementation continues to create a wide gap between policy decisions and tangible outcomes.
Science, technology, and innovation have likewise been identified as essential drivers of sustainable double-digit growth. Yet implementation has lagged, and much of the country’s potential has yet to translate into stronger labor productivity and higher Total Factor Productivity (TFP), which will need to become the economy’s primary growth engines.
Bridging the gap between policymaking and implementation, and between development ambitions and execution, will therefore be one of the most important tasks for economic management in the second half of 2026 and beyond.
Turning policy into results
Achieving double-digit growth will require more than short-term policy measures. It also demands more effective implementation. The challenge is no longer simply introducing new policies, but ensuring they are executed quickly and effectively so they translate into tangible gains for businesses and the broader economy.
The first priority is to continue strengthening institutions and creating a more transparent, predictable, and business-friendly investment environment. The Party’s major policies on private sector development, growth model transformation, science and technology, innovation, digital transformation, and administrative reform must be implemented in a coordinated manner to unlock resources and improve their allocation.
Closer coordination between fiscal and monetary policy will also remain essential. Fiscal policy should prioritize strategic infrastructure, science and technology, digital transformation, the green transition, and human capital development. Monetary policy, meanwhile, should remain flexible and prudent, supporting businesses’ access to finance while maintaining inflation control, exchange rate stability, and financial system resilience.
Unlocking and deploying development resources more effectively will be critical. Public investment must serve as genuine “seed capital,” with success measured not only by faster disbursement but by its ability to crowd in private investment and expand the economy’s productive capacity. At the same time, the private sector should be given greater room to grow through improved access to finance, technological upgrading, digital transformation, green transition, and higher labor productivity.
Local governments, particularly major growth hubs such as Hanoi, Ho Chi Minh City, Hai Phong, Quang Ninh, Bac Ninh, Da Nang, Dong Nai, and Can Tho, also have a pivotal role to play. Their objective should extend beyond meeting local growth targets to generating wider spillover effects through stronger regional connectivity, a better investment climate, improved governance, and more effective use of their comparative advantages.
With the global economy still facing considerable uncertainty, strengthening resilience must remain a strategic priority. Geopolitical tensions, rising trade protectionism, financial market volatility, and shifting tariff policies all underscore the need for Vietnam to reinforce its macro-economic fundamentals, diversify export markets, strengthen business competitiveness, and enhance its ability to withstand external shocks.
Science, technology, and innovation must also become genuine drivers of growth. The challenge is no longer defining policy direction but accelerating implementation so that innovation, digital transformation, and technological progress translate into stronger labor productivity and higher TFP.
Ultimately, the success of Vietnam’s double-digit growth ambition will depend on implementation. The country has no shortage of sound policies, ambitious resolutions, or development resources. What remains lacking in many cases is effective execution, leaving a persistent gap between policy intentions and real-world outcomes. Policies implemented too slowly can squander valuable opportunities, while delayed infrastructure projects increase costs and weaken competitiveness.
Double-digit growth, therefore, will depend not only on the quality of policymaking but also on the country’s ability to turn policy into results. That will be the decisive factor in transforming today’s strong foundations into sustained, high-quality growth in the years ahead.
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