Vietnam Strengthens Exports Amid Industrial Policy Overhaul

Vietnam’s export engine remains one of Asia’s most consistent performers. Despite soft global demand, total shipments grew 6.4 % year-on-year through Q3 2025, powered by electronics, textiles, and machinery. The Ministry of Planning and Investment has now unveiled the National Industrial Policy 2030—a blueprint to move up the manufacturing value chain, expand renewable energy capacity, and deepen supply-chain integration with ASEAN and global partners.

The plan’s backbone is diversification. Vietnam’s overreliance on assembly exports is being challenged by rising labour costs and competition from regional peers. The government aims to attract high-tech investment in chip design, semiconductors, and precision manufacturing, supported by tax incentives and infrastructure corridors linking Hai Phong, Da Nang, and Ho Chi Minh City. The logistics upgrade, anchored by new port expansions and expressway networks, is expected to reduce shipping times by 20 % over the next three years.

Currency and inflation stability provide breathing space. The State Bank of Vietnam has managed the USDVND near 25,200, intervening intermittently to smooth volatility. Inflation is projected at 3.2 %, enabling a neutral monetary stance. Foreign reserves now exceed US$110 billion, a record level that strengthens external credibility and cushions against trade or capital shocks.

Foreign direct investment inflows reached US$27 billion in the first nine months of 2025, led by South Korean, Japanese, and Singaporean manufacturers relocating from China. Electronics firms are expanding assembly to design operations, marking a structural evolution in Vietnam’s production base. However, infrastructure strain, energy demand, and labour productivity remain persistent bottlenecks. The government is accelerating power-grid expansion to integrate solar and LNG capacity, but implementation delays and cost overruns continue to challenge regional targets.

Financial markets have reacted positively. The VN Index gained 5 % this quarter, led by industrial and logistics equities, while sovereign bond yields remain anchored at 3.8 %. The trade surplus, forecast at US$13 billion for 2025, supports exchange-rate stability and investor confidence.

Vietnam’s strategy heading into 2026 is clear: climb higher on the value chain, manage inflation quietly, and turn external uncertainty into an advantage. The question now is whether reform execution can match the ambition—industrial depth, not export volume, will define the next decade.