Citi predicts an uptick in Vietnam's economic growth rate by 2025
In a recent report, Citi analysts have expressed a positive outlook for the deepening of onshore supply chains in Vietnam, despite certain risks posed by global trade policy uncertainties and stricter enforcement of rules of origin certification.
The Vietnamese government has taken steps to strengthen the inspection and supervision of the origin of goods, following a directive issued in April. This stricter enforcement could cause export delays and accentuate a near-term export payback or reversal, especially in the first three quarters of 2025 following frontloaded shipments earlier in the year.
However, the prospects for further deepening of Vietnam's onshore supply chains remain strong. Provinces like Thanh Hoa are developing as manufacturing hubs, with strong infrastructure and investment in key sectors such as petrochemicals, refining, energy, and agro-processing. The expansion of domestic industries, including energy storage and battery manufacturing, is underway to strengthen onshore supply chains and reduce dependency on external supply risks.
The growth acceleration in the first half of 2025 was supported by both manufacturing and domestically oriented sectors. Vietnam's GDP growth in the first half of 2025 reached 7.52%, exceeding Citi Vietnam's expectations.
Despite ongoing uncertainties regarding global trade policies, including raised US tariffs on Vietnam, these factors are unlikely to significantly undermine the long-term deepening of Vietnam’s onshore supply chains. The structural growth in manufacturing and integration of new industries, combined with government oversight, buttresses a cautiously optimistic outlook for supply chain strengthening in Vietnam this year.
Citi has raised its forecast for Vietnam's 2025 GDP growth to 7% from the previous 6.6%. The launch of the Vietnam Economic Report 2025, hosted by the Ministry of Foreign Affairs in coordination with the Ministry of Finance and the Organisation for Economic Cooperation and Development (OECD), provides insights on a sustainable growth strategy.
The report also highlights the Citi Foundation's 2025 Global Innovation Challenge, which aims to accelerate youth employability. Requests for proposals are currently underway until March 4.
In addition, commercial banks' pre-tax profits in 2025 are forecast to grow by 14.9% year-on-year. Export growth fell slightly in June, from 17% in May to 16% on-year, but this has not affected the growth acceleration in the first half of 2025.
The outlook for the deepening of onshore supply chains in Vietnam in 2025 remains highly positive, despite certain risks posed by global trade policy uncertainties, stricter enforcement of rules of origin certification, and potential export payback effects.
The Vietnamese government's focus on strengthening the domestic industries and improving the inspection of goods' origin could positively impact the local finance sector, as the expansion of domestic industries such as energy storage and battery manufacturing will create new business opportunities.
In light of the growing onshore supply chain industry in Vietnam and the positive outlook for GDP growth, commercial banks are expected to witness increased profits, further bolstering the overall business environment.
