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Vietnam's economic narrative in November 2024 is one of resilience, strategic growth, and bold international positioning. Despite global challenges, the country demonstrated remarkable economic dynamism, with Q3 GDP growth reaching a two-year high of 7.40% and continued efforts to diversify and modernize key sectors. From attracting significant foreign direct investments to establishing groundbreaking international partnerships, Vietnam is actively constructing a future defined by technological innovation, infrastructure development, and strategic global collaborations.
I. Business News:
1. Market Outlook
Vietnam's Q3 GDP growth reaches its highest in two years.
Vietnam's GDP grew by 7.40% year-on-year in Q3 2024, accelerating from 7.09% in Q2 and marking the highest growth since Q3 2022. This growth, despite the impact of a major typhoon in September, reflects strong final consumption (up 7.02%) and a 15.68% rise in exports. Services (7.51%) and industry & construction (9.11%) saw increased activity, while agriculture slowed (2.58%). The economy grew by 6.82% in the first three quarters, surpassing the 6.42% growth in H1. The government targets 6.8-7.0% GDP growth for the year but remains cautious about global challenges.
2. Vietnam Key Indicators
Vietnam's manufacturing sector expands for the second consecutive month.
Vietnam's Manufacturing PMI dropped to 50.8 in November 2024 from 51.2 in October, marking the second consecutive month of growth in factory activity after September's contraction due to Typhoon Yagi. Output and new orders increased at a slower pace, while foreign demand fell sharply. Employment contracted for the second month, and work backlogs continued to rise, though more slowly. Firms reduced purchasing activity, and delivery times lengthened due to transport and supply chain issues. Input prices rose modestly, and output prices increased slightly. Business sentiment fell to its lowest level since January.
Vietnam's inflation rate slowed in November.
Vietnam's annual inflation rate decreased to 2.77% in November 2024, down from 2.89% in October. This was mainly due to lower inflation in food and catering services (4.12%) and a slowdown in prices for medicaments and health services (5.28%). Transport costs continued to decline. However, housing and construction material prices rose (5.06%). Core inflation, excluding volatile items, increased to 2.77%, its highest in seven months. On a monthly basis, consumer prices rose by 0.13%, easing from the previous month's 0.33% increase.
Foreign direct investment (FDI) in Vietnam rose by 7.1% year-on-year to $21.68 billion from January to November 2024.
The processing and manufacturing sector attracted the largest share at $20.2 billion (64.4%), though it declined by 8.7% year-on-year. Real estate saw a significant increase, rising 89.1% to $5.63 billion. Singapore was the largest investor with $9.14 billion, followed by South Korea at $3.89 billion. FDI pledges, indicating future investments, grew by 1% to $31.38 billion.
3. Government Direction & Public Infrastructure
Vietnam Restarts Nuclear Power Project and Adjusts Long Thanh Airport Construction Schedule.
Vietnam's National Assembly approved two significant decisions: restarting the Ninh Thuan nuclear power project and adjusting the Long Thanh airport construction timeline. For the nuclear power project, the assembly agreed to continue investing in two power plants (Ninh Thuan 1 and 2) with a total capacity of 4,000 MW, aimed at diversifying energy sources and targeting net-zero emissions by 2050. Regarding Long Thanh airport, the assembly decided to postpone the completion of phase 1 to the end of 2026 and approved constructing two parallel runways in the northern area. Both projects are expected to contribute to national infrastructure and capacity development.
Bulgaria Ready to Bridge Vietnam's Access to EU Market.
On the morning of November 25, 2024, at the Presidential Palace, President Luong Cuong held talks with Bulgarian President Rumen Radev ahead of the 75th anniversary of diplomatic relations between the two countries in 2025. Bulgaria considers Vietnam an important partner in Southeast Asia and takes pride in contributing to Vietnam's development, including training over 30,000 skilled technical workers. Both sides agreed to strengthen trade and investment cooperation, particularly in information technology and supporting industries. Bulgaria, with its strategic geographical position, is ready to serve as a bridge for Vietnam's access to the EU market and was among the first countries to ratify the EVIPA agreement. The two nations also agreed to enhance people-to-people exchanges, facilitate visa issuance, and committed to close coordination in multilateral forums, especially regarding the East Sea issues and international disputes.
Ho Chi Minh City: Focusing on Completing Pre-feasibility Study for Ring Road 4.
HCMC Chairman Phan Van Mai recently chaired a meeting on Ring Road 4 project, a national key project spanning 206.72 km across five provinces: HCMC (16.7 km), Ba Ria - Vung Tau (18.23 km), Dong Nai (46.08 km), Binh Duong (47.45 km), and Long An (78.3 km). The project's preliminary investment for phase 1 is approximately 122,774.28 billion VND. According to the plan, HCMC will coordinate with other provinces to complete the pre-feasibility study in November-December 2024, submit to the National Assembly in Q1/2025, organize investor selection in Q4/2025, commence construction in Q1-Q2/2026, and complete the project by 2028.
4. Potential Industries
Bright Spots in the Coastal Central Region Real Estate Market.
The coastal Central region's real estate market in Q3 2024 is showing promising signs with strong growth in localities like Da Nang and Quang Binh, demonstrated by high apartment search demand (particularly Quang Binh's 516% increase), selling prices rising 32-41%, and growing attention to legal and construction quality factors. Advantages in infrastructure, tourism potential, natural landscapes, and cultural heritage have contributed to opening new development prospects for the regional real estate market, with each locality striving to develop along unique orientations such as heritage urban areas, blue economy, and inter-regional connectivity.
New York City Commits to Supporting Ho Chi Minh City's Financial Hub Ambitions.
New York City has pledged to support Ho Chi Minh City's ambition to become a regional and international financial hub, following a historic sisterhood agreement signed between the two cities. The commitment was announced by NYC Mayor Eric Adams during a ceremony attended by Vietnamese Prime Minister Pham Minh Chinh at a UN summit. HCMC Chairman Phan Van Mai outlined potential areas of cooperation, including workforce training, science-technology, innovation, and financial sector development, with a particular focus on attracting NYC investment and providing HCMC businesses greater access to New York's investment funds and banks. This partnership aligns with Vietnam's Politburo's approval in late 2022 to transform HCMC into an Asian financial hub and world-class metropolis. The agreement adds New York to HCMC's network of over 50 sister cities worldwide, building upon existing U.S. ties such as its 1995 sisterhood with San Francisco, and comes amid strengthened U.S.-Vietnam relations following a recent double upgrade in diplomatic status.
5. Big FDIs companies News
Nvidia Expands Aggressively in Vietnam: Massive AI Research and Data Center Collaboration.
In the context of the global AI boom, Nvidia is expanding aggressively in Vietnam by recruiting numerous high-tech personnel in Hanoi. The Vietnamese Government and Nvidia have signed an agreement to establish an AI Research and Development Center and an AI Data Center in Vietnam. With a market capitalization of $3.49 trillion, the world's leading chip manufacturer is seeking highly qualified experts, committed to supporting Vietnam's AI development in a manner aligned with the country's cultural and historical context. Prime Minister Pham Minh Chinh has also pledged to create the most favorable conditions for effective cooperation.
Xanh SM's Bold Move: Electrifying Indonesia's Taxi Market.
Xanh SM, a Vietnamese electric taxi company, is expanding into Indonesia with VinFast's support, targeting a promising but competitive market of 270 million people. Planning to launch in Jakarta in 2024 through a partnership with GoTo Gojek Tokopedia, the company will introduce VinFast electric vehicles like VF 5, VF e34, and VF 3, while facing challenges from established electric vehicle brands such as Wuling, Tesla, and BYD. Although the Indonesian government is encouraging electric vehicle development with a goal of 2.5 million users by 2025, the market remains challenging with electric vehicles currently representing less than 1% of total cars. With experience capturing 18.17% market share in Vietnam, Xanh SM hopes to succeed in Indonesia through a flexible strategy, market understanding, and patient trust-building.
Google Establishes Official Office in Vietnam from Q1/2025.
In early 2025, Google will officially establish its office in Vietnam, marking a significant transition in its business operations. The Google Vietnam Company Limited, established in late May 2023, will take over all functions from the Singapore headquarters, with its office located in Ho Chi Minh City. From March 1, 2025, products and services will be directly managed by the Vietnamese legal entity, bringing numerous advantages to local partners and businesses. Customers will receive invoices in Vietnamese dong, subject to 10% VAT, and the transition is designed to ensure uninterrupted service. This change is positively evaluated as facilitating easier accounting, auditing, and collaboration for businesses.
FPT Launches AI Factory in Japan Powered by NVIDIA Technology
On November 13, FPT launched its AI Factory in Japan, built on NVIDIA's accelerated computing and software platform. The factory offers three main product groups: FPT AI Infrastructure (GPU cloud services), FPT AI Studio (AI model building and fine-tuning tools), and FPT AI Inference (model deployment and scaling), along with over 20 generative AI products. This project stems from the strategic partnership agreement between FPT and NVIDIA signed in April 2024, with FPT planning to invest $200 million to build a sovereign AI Factory in Vietnam. FPT Chairman Truong Gia Binh affirmed commitment to collaborate with the government, businesses, and Japanese partners to expand global AI applications and realize both Japan's and Vietnam's vision of becoming AI nations.
The November business news report illuminates Vietnam's multifaceted approach to national development. By simultaneously focusing on economic growth, technological advancement, and strategic international partnerships, Vietnam is positioning itself as an emerging powerhouse in Southeast Asia. Whether through attracting major tech companies like Nvidia and Google, expanding electric vehicle markets, or forging diplomatic and economic ties with countries like Bulgaria and the United States, Vietnam demonstrates a sophisticated, forward-looking strategy. The country's commitment to sectors like AI, infrastructure, and sustainable development suggests a promising trajectory of continued growth and global integration in the coming years.
In terms of legal updates, Vietnam is undergoing significant legislative transformations across multiple sectors, signaling a strategic approach to modernizing its regulatory framework. In late 2024, the National Assembly and government introduced a series of progressive reforms that touch on critical areas including taxation, education, data governance, e-commerce, and trade promotions. These new laws and decrees represent a comprehensive effort to enhance transparency, streamline administrative processes, attract foreign investment, and support digital transformation while maintaining robust regulatory oversight.
5% VAT applied to fertilizers, VAT-exempt revenue threshold raised to 200 million VND per year
The National Assembly has just passed the amended Value Added Tax Law with an approval rate of 84.97% and two major changes. First, fertilizers will now be subject to 5% VAT instead of being tax-exempt, a point supported by 72.67% of National Assembly deputies. Second, the VAT-exempt revenue threshold for household businesses and individuals will increase from 100 million to 200 million VND per year, effective from January 1, 2026, while other provisions of the law will take effect from July 1, 2025. This threshold increase will help reduce tax obligations for approximately 620,653 business households, resulting in a state budget revenue reduction of about 2,630 billion VND annually. Notably, the new law also empowers the Government to adjust the tax-exempt revenue threshold to ensure alignment with socio-economic conditions in each period.
New regulations applied for foreign investment in the educational sector
On October 5, 2024, the Vietnamese Government issued Decree 124/2024/NĐ-CP, amending and supplementing Decree 86/2018/NĐ-CP on foreign investment in the education sector. The decree introduces significant changes to streamline administrative procedures, including digital submissions and data sharing, while revising 14 of 21 forms to reduce costs and complexity for investors. It establishes stricter investment timelines, requiring at least 50% of the committed capital to be implemented before operational approval and full investment within five years. The decree also emphasizes transparency, mandating that educational institutions disclose detailed information about programs, accreditation, and faculty on their websites. Collaboration with foreign institutions is subject to higher standards, requiring partners to be globally accredited and ranked in the top 500 universities, with curricula meeting Vietnamese educational goals. Additionally, local authorities are empowered to oversee foreign programs, ensuring compliance and quality while requiring schools to report program details within six months. These reforms aim to attract high-quality foreign investment, improve regulatory transparency, and align international education programs with Vietnam’s strategic objectives.
Long Awaited Law on Data has been approved by National Assembly
On November 30, 2024, Vietnam's National Assembly enacted its first-ever Law on Data, which is considered to have a higher and broader in scope compared to Decree 13 on Personal Data Protection. The Data Law regulates all forms of digital data, including personal data, alongside the National Data Center, General Database, digital data services, and the roles of stakeholders in data-related activities. Set to take effect on July 1, 2025, it marks a significant development for businesses engaged in data processing.
Key takeaways to the law focus on enabling cross-border data transfers, allowing organizations and individuals to process and transfer data across borders while ensuring the protection of legitimate interests. The law also prioritizes the development of a national database, centralizing data collection and synchronization to reduce administrative burdens and support government operations, policy-making, and socio-economic planning, with the Prime Minister overseeing its roadmap and strategy. Additionally, the establishment of a National Data Center under the Ministry of Public Security will clarify roles, ensure contingency planning, and integrate with existing regulations. The law introduces provisions for data exchange platforms, fostering a data market to promote digital transformation across industries while delegating detailed implementation regulations to the government. These initiatives reflect Vietnam’s strategic focus on building a robust data governance framework and advancing digital innovation.
Vietnam’s E-Commerce Platforms to Handle Merchant Tax Obligations from January 1, 2025
Starting January 1, 2025, e-commerce platforms in Vietnam will be required to declare and pay taxes on behalf of merchants using their platforms. This regulatory change aims to enhance tax compliance and streamline tax collection processes in the rapidly growing e-commerce sector, impacting both platform operators and online sellers.
New regulations on promotion
Effective December 1, 2024, Decree 128/2024/ND-CP introduces key amendments to Decree 81/2018/ND-CP, refining trade promotion regulations under the Commercial Law. Highlights include:
Promotion Value Cap: The maximum promotional value is set at 50% of the pre-promotion price for goods and services, with exceptions allowing up to 100% for centralized promotion programs or activities approved by the Prime Minister.
Discount Limits: Discounts are capped at 50% but can reach 100% in cases of government-backed promotions or specific business scenarios such as liquidation or restructuring.
Exemptions from Notification: Certain promotional activities, including those under specified thresholds or conducted via e-commerce platforms, are exempt from administrative notification.
Reporting Obligations: Merchants must submit post-promotion reports for specific activities, with penalties for unclaimed rewards, including 50% of unclaimed prize values being remitted to the state budget.
These legislative updates collectively demonstrate Vietnam's proactive stance in adapting to rapidly changing economic and technological landscapes. By implementing reforms that simplify administrative procedures, protect data interests, enhance tax compliance, and create more transparent investment environments, Vietnam is positioning itself as an increasingly attractive destination for international business and investment. The new regulations balance economic growth with strategic national interests, showing a nuanced approach to policy-making that seeks to modernize key sectors while protecting domestic priorities. As these laws take effect between 2025 and 2026, they will likely have profound implications for businesses, investors, and the broader economic ecosystem in Vietnam.
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