Get Rich Quick: Vietnam Charts Path to Becoming Asia\’s Next Tiger Economy

Vietnam’s Economic Strategy

Vietnam aims to emulate the success stories of Taiwan and South Korea, yet the nation recognizes that relying on a single industry is insufficient for building a robust and enduring economy.

• Diversification is Key: Emphasizing the need to broaden industrial sectors.
• Innovation Focus: Investing in research and development to foster new technologies.
• Global Integration: Enhancing trade partnerships beyond traditional markets.

Vietnam’s Strategic Leap Toward a 2045 “Tiger Economy”

Standing beneath crimson banners and a glittering bronze bust of Ho Chi Minh in Hanoi’s central party campus, Party chief To Lam publicly heralded an era of transformation. More than a ceremonial gesture, the address marked the commencement of Vietnam’s most extensive economic restructuring in recent history.

A Bold Target: Wealth by 2045

Vietnam has set an ambitious goal for the coming three decades: achieving prosperity comparable to the tier‑one economies of South Korea and Taiwan while positioning itself as Asia’s next growth powerhouse.

The Complex Landscape Ahead

• Balancing rapid foreign‑investment growth with the need for structural reforms.
• Addressing the challenges of an ageing demographic.
• Mitigating the impacts of climate change on infrastructure and agriculture.
• Reforming antiquated institutions that have slowed policy momentum.

International Trade Dynamics

The United States, under the leadership of former President Donald Trump, has expressed concern about Vietnam’s burgeoning trade surplus with the U.S. This reflects the country’s remarkable economic ascent.

Living Standards Over Time

In 1990, a typical Vietnamese household could purchase goods and services worth roughly $1,200 (about €1,025) annually, adjusting for local price levels. That figure has surged more than thirteenfold to $16,385 (≈ €13,995) today, illustrating the rapid rise in disposable income.

A Manufacturing Phoenix

Vietnam’s evolution into a global production hub is visible through its modern highways, soaring skyscrapers, and a burgeoning middle class—an achievement mirroring China’s own economic miracle. Yet the low‑cost, export‑driven growth model is now facing a slowdown.

Emerging Challenges for Reform

• Stimulating private sector expansion.
• Bolstering social safety nets.
• Driving investment toward technology and renewable energy solutions.
• Countering climate‑related obstacles that threaten the sustainability of growth.

Expert Insight

“Everyone must act now—there is no luxury in wasting time,” emphasized Mimi Vu of Raise Partners, underscoring the urgency of coordinated effort across all levels of governance.

As Vietnam charts its course toward a prosperous future, the blend of strategic vision, economic agility, and sustained social policy will be indispensable for turning its 2045 ambition into reality.

The export boom can’t carry Vietnam forever

Vietnam’s Trade Surge: A New Era of Global Integration

From Quiet Suburbs to Logistics Powerhouses

Vietnam has transformed, turning once‑quiet residential areas into sprawling industrial parks that now serve as hubs for major international brands. Trucks now crisscross these logistics centers as goods move quickly between global markets.

Trade Tensions and a New Tariff Landscape

In 2024, the country enjoyed a trade surplus of $123.5 billion (€105 billion) with the United States. This upside triggered President Trump’s reaction, initially threatening a 46% import duty on Vietnamese products. Negotiations have settled on a 20% rate, with double that for items suspected of transshipment through Vietnam to bypass U.S. restrictions.

Vietnam’s Strategic Focus on Tariffs

• Diplomatic emphasis on maintaining tariffs comparable to neighboring economies.
• Concern about the amount of Chinese content in Vietnamese exports and its potential impact on taxation.
• Continuing search for a balance that preserves competitiveness while avoiding punitive measures.

Preparing for the “Middle‑Income Trap”

Vietnam has anticipated the risks of the so‑called middle‑income trap—where economies plateau unless significant reforms are introduced. Proactive policy shifts were made to avoid being solely reliant on low‑cost manufacturing.

Learning from Regional Successes

South Korea’s focus on electronics, Taiwan’s on semiconductors, and Singapore’s on finance have all offered lessons. Vietnam now requires a broader strategy rather than a single winning sector, as rising wages diminish its traditional reliance on cheap labor.

McClellan on Multi‑Sector Growth

Richard McClellan, founder of RMAC Advisory, stresses the need for “multiple big bets.” Diversification across several high‑growth sectors will be essential for sustainable development and global competitiveness.

Key Takeaways

• Vietnam’s evolving trade dynamics reflect a shift from manufacturing to integrated logistics.
• Balancing tariff policies in the face of U.S. trade pressure remains a critical task.
• Diversification beyond low‑cost production is a strategic imperative for long‑term prosperity.

Vietnam’s game plan

Vietnam Accelerates Tech & Infrastructure Growth

Following China’s example, Vietnam is championing high‑tech industries—from semiconductor manufacturing and artificial intelligence to wind, solar, and battery technologies. In major urban hubs such as Hanoi, Ho Chi Minh City, and Danang, the government is offering strategic tax incentives and research grants to nurture these sectors.

Major Infrastructure Projects

• Construction of civilian nuclear power plants to diversify the energy mix.
• Launch of a $67 billion (≈€57 bn) North‑South high‑speed rail line, cutting travel time between Hanoi and Ho Chi Minh City to just eight hours.
• Expanded road and port networks to improve connectivity across the country.

Aspiration for a Global Financial Hub

Vietnam is earmarking two special financial centers:

• Ho Chi Minh City—an economic engine already buzzing with activity.
• Danang—a coastal resort town poised to become a financial nova.

These centers will feature simplified regulatory frameworks, generous tax breaks, dedicated support for fintech enterprises, and streamlined mechanisms for dispute resolution.

Structural Reform at the Institutional Level

To bolster the growth of these initiatives, the country is:

• Consolidating ministries and eliminating redundant lower‑level bureaucracy.
• Reducing the number of provinces from 63 down to 34, creating larger regional hubs with richer talent stocks.
• Embedding deeper coordination between industry, academia, and government to drive innovation.

Through these bold moves, Vietnam is positioning itself as a modern economic powerhouse that attracts global talent, investment, and cutting‑edge technology.

Private business to take the lead

Vietnam Charts a New Economic Course

Resolution 68: A Call for Private Power

The Communist Party’s latest directive, Resolution 68, underscores private enterprises as the cornerstone of Vietnam’s future growth. It signals a decisive move away from the supremacy of state‑owned entities and foreign multinational giants.

Current Landscape: Multinationals vs. Local Firms

Export volumes have largely depended on large multinationals that source materials abroad and rely on inexpensive local labor.
Key challenges for Vietnamese companies include limited access to financing and restricted market reach, largely dominated by the few state‑owned conglomerates that trace back to colonial and socialist eras.

Illustrative Examples

• State‑run beer breweries that feature historic arched windows
• Unfashionable, government‑managed retail outlets with scant footfall

Expert Insight

Nguyen Khac Giang, a researcher at ISEAS–Yusof Ishak Institute in Singapore, notes, “The private sector is still under significant constraints.”

Vietnam’s Ambitious Plan for National Champions

Heavily influenced by China’s model, Vietnam aims to foster national champions that drive innovation and compete on the global stage. This approach prioritizes market dynamics over hand‑selected winners.

Policy Measures

• Easier access to loans for businesses investing in cutting‑edge technology
• Priority in public procurement for firms that meet predefined innovation benchmarks
• Targeted assistance for companies expanding internationally
• Opening key infrastructure projects, such as the North‑South High‑Speed Rail, to private competitive bidding

Targets and Challenges

Vietnam’s roadmap sets a goal of elevating at least 20 private firms to achieve global recognition by the year 2030.
However, Giang cautions about potential resistance from party hardliners and entrenched beneficiaries of state‑owned enterprises.

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A Closing Window from climate change

Urgent Action Needed for Climate Resilience in Vietnam’s Industrial Zones

After the loss of a major investor over flood risks, Bruno Jaspaert realized that change was imperative. His company, DEEP C Industrial Zones, hosts more than 150 factories across northern Vietnam. To safeguard its operations, the firm hired a consultancy to overhaul its flood‑resilience strategy.

Climate Risk as a New Market Regulator

Climate risk is evolving into a form of market regulation that compels businesses to:

• Plan more effectively
• Build with smarter designs
• Adapt swiftly to changing conditions

Jaspaert remarked that if the global community made climate protection a priority, progress could accelerate significantly.

Impact of Typhoon Yagi

Last year’s Typhoon Yagi inflicted $1.6 billion ($1.4 bn) in damage, reducing Vietnam’s GDP by 0.15% and severely affecting factories that contribute nearly half of the country’s economic output. Remarkably, roads within the DEEP C industrial parks remained dry during the storm.

Long‑Term Consequences of Inaction

According to the World Bank, failing to adopt strong adaptation and mitigation measures could cause Vietnam to lose between 12% and 14.5% of its GDP annually by 2050. Additionally, up to one million people might fall into extreme poverty by 2030.

The Aging Workforce Dilemma

Vietnam’s “golden population” period—when the working‑age demographic surpasses dependents—will end by 2039. The labour force is projected to peak only three years later, potentially lowering productivity and burdening social services. Families, especially women, often serve as primary caregivers, highlighting the need for systemic support.

Strategies for Healthy Ageing and Labour Stability

To mitigate these challenges, Vietnam is:

• Expanding access to preventative healthcare to keep older adults healthier and more independent.
• Gradually raising the retirement age.
• Encouraging greater participation of women in the formal workforce.

These measures aim to fill labour gaps, promote sustainable growth, and ensure a healthier, more resilient society.