Vietnam’s economy expanded faster than anticipated in the third quarter of 2025, with manufacturing and exports cushioning the impact of new US tariffs.
According to a Bloomberg report, the country’s ability to sustain growth amid rising trade barriers underscores its industrial resilience and strengthens its position as a key hub in Asia’s supply chain.
Data released by the National Statistics Office (NSO) in Hanoi on Monday states that gross domestic product rose 8.23% year-on-year in the July–September period, surpassing the 7.15% median estimate of analysts.
Second-quarter growth was also revised up to 8.19% from an earlier 7.96%, reflecting stronger-than-expected performance across industrial sectors.
Manufacturing cushions tariff pressure
Industrial output remained the key growth driver, with manufacturing rising 9.92% in the first nine months of 2025 compared with the same period a year earlier.
This acceleration came as companies increased production ahead of the US tariff deadline imposed in early August, according to NSO head Nguyen Thi Huong.
The export-dependent economy faced a 20% tariff introduced by President Donald Trump, yet Vietnam’s factories adapted quickly to preserve market share.
The surge in manufacturing activity helped offset external headwinds, demonstrating the country’s growing role as a regional production alternative amid global supply-chain realignments.
Exports and investment surge ahead of policy targets
Exports climbed 24.7% in September from a year earlier, while imports rose 24.9%, reflecting strong trade activity despite protectionist pressures.
The data indicated that businesses were front-loading shipments before higher tariff costs took effect, a strategy that supported GDP growth.
Meanwhile, pledged foreign direct investment rose 15.2% year-on-year in the first nine months, and disbursed FDI increased 8.5%, showing continued confidence among overseas investors.
With multinational corporations diversifying away from China, Vietnam remains a preferred destination for electronics, apparel, and technology supply chains.
The government has set an ambitious full-year growth target of between 8.3% and 8.5%. Although the external environment remains uncertain, the strong third-quarter performance brings the economy closer to achieving its goal.
Market reaction and inflation trends
The benchmark VN Index responded positively, rising as much as 1.9% on Monday morning — its sharpest increase since 26 August. The rally signalled investor optimism about Vietnam’s economic trajectory and manufacturing prospects.
Inflation, while inching higher, remains within the government’s target range. Consumer prices rose 3.38% in September from a year earlier, below the ceiling of 4%–4.5% set for 2025.
This stability provides room for the State Bank of Vietnam to maintain supportive monetary conditions while managing risks from global price volatility.
Vietnam’s growth strategy amid shifting trade dynamics
Vietnam’s performance underscores the success of its export-driven strategy and manufacturing depth. The country’s rapid expansion — 7.85% in the first nine months of 2025 — reflects structural advantages such as competitive labour costs, an improving logistics network, and trade pacts with major economies.
The government has prioritised industrial diversification and digital transformation to enhance value addition in sectors like electronics, semiconductors, and green manufacturing.
While tariffs from the US pose a challenge, the reorganisation of production and sustained FDI inflows could help mitigate the impact over the coming quarters.
With Asia’s manufacturing landscape evolving rapidly, Vietnam’s latest GDP results reaffirm its role as one of the region’s fastest-growing economies.
The momentum in industrial output, foreign investment, and trade suggests that despite global headwinds, the nation remains on track to consolidate its position as a vital manufacturing and export hub.
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