Eighty years after the August Revolution and the declaration of independence on September 2, Vietnam has risen from poverty to become the 34th largest economy globally, with its GDP reaching $476.3 billion in 2024. The country’s per capita income is now approaching upper-middle-income levels.

Continuing this journey of transformation, on a single autumn day in 2025, Vietnam inaugurated and broke ground on 250 major infrastructure projects across the country, with a total investment capital of 1.28 quadrillion VND (approximately $52.5 billion USD). This monumental effort reflects not only collective determination but also symbolizes Vietnam’s ambition and will to enter a new era of development.

From famine to a GDP of over $476 billion

For years, the World Bank has regarded Vietnam as a development success story, especially since the Doi Moi (Renewal) reforms launched in 1986. These economic reforms, coupled with globalization, lifted Vietnam from being among the world’s poorest nations to becoming a lower-middle-income country.

“Doi Moi has been the engine of economic development for four decades, abolishing the old command economy. Vietnam overcame crises and became one of the most dynamic economies, with GDP growing significantly from just $8 billion in 1986 to an estimated $476.3 billion in 2024, a nearly 60-fold increase,” said Nguyen Bich Lam, former General Director of the General Statistics Office.

Data from the General Statistics Office shows that Vietnam’s GDP in 1990 stood at just 41.96 trillion VND. It surpassed 100 trillion VND in 1992 and exceeded 1 quadrillion VND in 2006. Despite global financial crises and the COVID-19 pandemic, GDP growth remained steady. In 2023, GDP reached a record 10.32 quadrillion VND, and by 2024 it had exceeded 11.5 quadrillion VND (approximately $476.3 billion USD), ranking fourth in Southeast Asia and 34th globally - 274 times higher than in 1990.

Similarly, gross national income (GNI) rose from 39.28 trillion VND in 1990 to nearly 10 quadrillion VND in 2023 - a 249-fold increase.

Preliminary data shows Vietnam’s per capita income in 2024 reached $4,700, up from $4,323 in 2023. This positions the country on the threshold of achieving upper-middle-income status. This is a nearly 55-fold increase from the $86 per capita in 1988 and more than 4.7 times the $1,000 level in 2007 when Vietnam joined the World Trade Organization.

According to the UK-based Centre for Economics and Business Research (CEBR), Vietnam’s GDP is forecast to hit $676 billion by 2029, overtaking Singapore’s projected $656 billion. However, as Vietnam's 2024 GDP already exceeds CEBR's forecast by $26 billion, and with 2025 growth potentially hitting 8% or even double digits, the timeline to surpass Singapore could be shorter than expected.

Vietnam’s per capita income is growing faster than in countries like Thailand and the Philippines, likely enabling it to officially reach upper-middle-income status in 2025.

An economy built to overcome obstacles

“Vietnam recovers from crises faster than other nations,” said Phan Minh Thong, Chairman of Phuc Sinh Corporation, quoting foreign partners during trade negotiations. Thong, dubbed the "pepper king," believes that pro-business policies focusing on the private sector will fuel Vietnam’s growth in the next 5-10 years.

Chau Minh Thi, Director of Trieu Phong Shoe Company and Chairman of the Ho Chi Minh City Leather and Footwear Association, also affirmed the government’s pivot toward private sector development and public investment as the right strategy for economic growth.

Foreign buyers are increasingly choosing Vietnam over other countries for sourcing, Thi added. The reasons? High product quality and a vibrant, developing business environment that attracts international partners.

A macroeconomic report by Standard Chartered released in July 2025 shows a strong recovery in foreign direct investment (FDI), led by manufacturing, followed by real estate. Disbursed FDI in the first half of 2025 rose by 8.1% year-on-year to $11.7 billion, while pledged FDI soared by 32.6% to $21.5 billion.

UOB reported that FDI disbursement in H1 2025 was the highest in the past five years.

On trade, Matthew Powell, Director of Savills Hanoi, noted that in response to US tariff concerns, Vietnam has actively negotiated to reduce trade tensions and has tightened controls on counterfeit and transshipped goods. The country is also diversifying its trade relations to reduce reliance on the US market and restructure its economy accordingly.

Despite global volatility and trade tensions, Vietnam remains committed to reforms and investment attraction. The steady FDI flow and infrastructure development are promising indicators of long-term growth.

According to Nguyen Ngoc Hoa, Chairman of the Ho Chi Minh City Business Association (HUBA), the biggest current challenge is the US tax regime. With transit tariffs reaching up to 40%, Vietnamese exporters must prove high local content to access the US market. This requires restructuring supply chains and enhancing traceability.

Vietnam must continue attracting FDI but also ensure technology transfer and local content increase. Vietnamese companies must invest to be ready for this transition.

In 2024, Vietnam’s export turnover reached $405.53 billion, accounting for about 85% of GDP, underscoring the critical role of exports in the economy.

As global import standards tighten, businesses lacking transparency and traceability risk losing markets. Additionally, green certifications are becoming essential. Companies that fail to adopt sustainable practices risk falling behind or being excluded altogether.

“Green transition, digital transformation, and readiness for technology transfer are major challenges, especially for SMEs, which make up 98% of Vietnamese businesses and have limited financial capacity,” said Hoa.

HUBA proposes that pioneering tech companies provide shared solutions. Instead of SMEs investing billions in full systems, early adopters can offer shared tools for a monthly rental fee. This would reduce upfront costs and allow smaller businesses to adapt, creating ripple effects across the economy.

The four pillars of Vietnam’s new era

Vietnam has recently restructured its administrative system, officially operating with a two-tier government model in 34 provinces and cities since July 1, 2025. This shift comes alongside four transformative policies:

Resolution 57: Advancing science, technology, innovation, and national digital transformation
Resolution 59: Strengthening international integration in a new global context
Resolution 66: Reforming legislation to meet development needs in the new era
Resolution 68: Promoting private sector development

“These are foundational pillars for institutional reform, forming a powerful engine to propel Vietnam into a new era of development, prosperity, and strength,” affirmed General Secretary To Lam.

According to Dr. Can Van Luc, Chief Economist at BIDV and member of the Prime Minister’s Economic Advisory Council, if Vietnam sustains 9% GDP growth annually from 2026–2030 and 8% from 2031–2045, the national per capita GNI could reach $22,600 by 2045.

However, he emphasized that double-digit growth isn’t necessary every year. Vietnam can achieve its goal of becoming a high-income country by 2045 with steady, inclusive, and sustainable development.

Luc stressed the importance of controlling inflation (under 5%), fiscal deficits (4-4.5%), and public debt (under 60% of GDP), while avoiding environmental damage or macroeconomic instability in pursuit of growth.

The growth model must focus more on productivity rather than capital or investment. It should simultaneously leverage investment, technology infusion, and innovation rather than progressing sequentially.

In addition to the current strategic trio (institutional reform, infrastructure, human resources), he recommends adding two more: science-technology - digital transformation, and anti-wastefulness.

Mobilizing four key resources will be vital: institutional reform, finance, land and resources, and anti-waste measures. The BIDV research group estimates Vietnam will need to mobilize financial resources equal to 38.4% of GDP (around $250 billion annually) from 2026–2030 and 36.8% of GDP (around $500 billion annually) from 2031–2045.

Luc also emphasized the need to manage risks and improve policy implementation, particularly in deploying the new provincial and municipal administrative model. Leadership competence, technological integration, data usage, and streamlining administrative procedures are now critical.

Professor Ta Ngoc Tan, Vice Chairman of the Central Theoretical Council, highlighted Resolution 68 as a bold declaration to make the private sector the primary driver of the economy. It outlines clear tasks to improve the business environment, support access to land and capital, foster innovation, and cultivate leading enterprises.

“This revolutionary shift in mindset and strategy must be matched by maximum effort from the private sector and full support from ministries and local governments,” said Professor Tan. “Only then can Resolution 68 quickly take root and help realize the grand national vision of Vietnam becoming a high-income, developed country by 2045.”

Tam An - Nguyen Le - and Tran Chung