According to the World Economic League Table 2022 study by the Center for Economic and Business Research, Vietnam is expected to become the second-largest economy in Southeast Asia after Indonesia and the 20th-largest economy in the world by 2036. (CEBR).
According to the research, Vietnam is expected to have a purchasing power parity adjusted GDP per capita of $11,608 in 2021.
Vietnam’s economic growth narrative has been nothing short of miraculous, with the doi moi reform in the mid-1980s, along with favorable global trends, allowing the country to achieve fast economic growth and driving it from a poor to a lower-middle-class country.
The economy uses five-year plans to forecast its economic future, with the current plan focusing on the continuance of the present economic development model from 2021 to 2025. Manufacturing will help growth, as will deeper integration into global supply chains and the search of trade alliances and export diversification.
A solid labor market is underpinning 2021’s high GDP growth. The unemployment rate declined by 0.6 percentage point to 2.7% in 2021.
Government debt as a percentage of GDP reached 47.9% in 2021, up from 46.3 percent the previous year. This rise is due to the pandemic’s influence on government spending and tax collections.
Vietnam wants to be a high-income country by 2045. To achieve this, it needs increase at an annual average rate of about 5% per capita. Vietnam’s current five-year plan forecasts annual growth of 6.5 percent for the next decade, putting the country on pace to meet its goals.
Nonetheless, it confronts significant obstacles on its way to become a high-income country. With global commerce dwindling and its population aging, it has to substantially enhance policy implementation effectiveness, particularly in industries that will be badly impacted by technology and climate change.
According to CEBR, Vietnam’s standing in the World Economic League Table will improve significantly between 2021 and 2036, increasing from 41st to 20th by 2036.
Vietnam will be second only to Indonesia in Southeast Asia at that time. Thailand will be rated third in Southeast Asia and 22nd globally.
According to the IMF, Vietnam will be the third largest economy in Southeast Asia by 2025, with a GDP of $571.12 billion, trailing only Indonesia ($1.63 trillion) and Thailand ($632.45 billion), but surpassing Malaysia ($556 billion), the Philippines ($523.53 billion), and Singapore ($496.81 billion).
Thailand and Vietnam will have GDPs of more than $690 billion by 2027 (Thailand $692.6 billion and Vietnam $690.11 billion). Vietnam’s GDP is expected to officially overtake Thailand’s after 2028.
If the CEBR projection is true, Vietnam’s GDP will overtake Poland, Switzerland, Sweden, Belgium, and Australia by 2036.
