An emerging market that shone in a difficult year
The list of countries that managed to grow their economies last year is an unusually short one, which makes Vietnam stand out. Its GDP growth rate of 2.9% was low by historical standards – it typically manages 6%-7% – but still put it ahead of every other major economy in Asia and looks remarkable given the damage that the coronavirus pandemic inflicted on the world. Even at the peak of the crisis in the second quarter of the year, Vietnam just about eked out positive growth and has recovered quickly.
Many MoneyWeek readers will be familiar with the reasons to be bullish about Vietnam’s prospects – we’ve written about it a lot over the years. A large population (97 million), helpful demographics (average age of 32), decent education levels, rising urbanisation and industrialisation, and a manufacturing sector that has increased its share of global exports by more than any other country over the past decade – together this suggests great potential for sustainable long-term growth. In key respects, Vietnam resembles South Korea or Taiwan – which made a spectacular success of economic development – much more closely than some of its Southeast Asian neighbours that have not yet managed to rise so far.
Its performance over the past year
