Vietnam's Rise in GDP Contributed Mainly by Exports

Vietnam's gross domestic product (GDP) in the first quarter of the year grew by 5.66% compared to the same period last year, according to government data released on Friday. This growth comes despite challenges such as higher shipping costs due to disruptions in the Red Sea.

The growth in the first quarter was faster than the 3.41% expansion seen in the same period last year but slower than the 6.72% growth recorded in the fourth quarter. Typically, growth in the first quarter is lower due to festival holidays.

Vietnam, known as a regional manufacturing hub and a significant exporter of electronics, smartphones, and garments, is working to boost its business activities after falling short of its growth target last year due to weak global demand and brief power shortages. This year, it has set a GDP growth target of 6.0%-6.5%.

According to the General Statistics Office (GSO), the manufacturing and construction sector grew by 6.28%, while the services sector expanded by 6.12% in the quarter compared to the same period last year.

Despite disruptions in shipping through the Red Sea caused by attacks from the Houthis, Vietnam's goods exports saw significant growth in the quarter. Goods exports grew by 17% year-on-year to $93.06 billion, while imports increased by 13.9% to $84.98 billion, resulting in a trade surplus of $8.08 billion.

Key export sectors such as electronics, smartphones, and garments performed well, with electronics shipments rising by 30%, smartphone exports increasing by 10%, and garments growing by 7.9%.

Industrial production also saw a robust increase of 21.7% year-on-year in the quarter, while consumer prices in March rose by 3.97% compared to the same period last year. Retail sales for the January-March period rose by 8.2%.

Prime Minister Pham Minh Chinh recently assured foreign investors that the country would address power shortages, with Vietnam ramping up coal imports. Electricity output in the first quarter grew by 11.4% compared to the same period last year, reaching 65.5 billion kWh.