Vietnam’s ambitious goal of 8% GDP growth in 2025, followed by double-digit expansion in the coming years, presents a crucial moment for economic reform.

Economist Tran Du Lich warns that this may be the country’s only opportunity to implement structural changes before it faces the challenge of an aging population.

Export concerns and domestic market innovation

At the 2025 Vietnam Economic Forum, organized by Nguoi Lao Dong newspaper on March 13, business leaders and policymakers discussed strategies for achieving high growth.

Tran Nhu Tung, chairman of Thanh Cong Group, emphasized that sustained national growth relies on the expansion of individual businesses.

He noted that Vietnam’s textile and garment exports reached $44 billion last year, with a target of 10% growth in 2025. Orders have seen modest increases in early 2024, but risks remain - especially from the United States, which accounts for 40% of Vietnam’s textile exports.

Concerns loom over potential tariffs from the administration of former U.S. President Donald Trump, expected to take effect in April. While higher tariffs on Chinese textiles might benefit Vietnam on paper, many Vietnamese manufacturers depend on Chinese raw materials, creating uncertainty.

Tung urged textile enterprises to closely monitor international market trends and called on financial institutions to introduce preferential credit programs for digital and green transformation. He also recommended simplified administrative procedures to help businesses access a 30% reduction in land rental fees.

Meanwhile, Nguyen Anh Duc, CEO of Saigon Co.op, stressed the critical role of domestic consumption in economic growth. Historically, the retail and service sector grows at 1.5 times the national GDP rate - meaning that if GDP expands by 8%, retail must grow by at least 12%.

Duc outlined three strategic approaches for businesses:

Foundational reforms: Strengthening consumer confidence through fair wages and supporting enterprises with clear policies.

Growth-oriented restructuring: Reducing costs and boosting revenues, particularly in traditional retail and e-commerce supply chains.

Innovative leadership: Encouraging creativity, as 30% of revenue for top businesses comes from innovation, whether through new formulas, markets, or customer segments.

There is no second chance for institutional reform

Economist Nguyen Dinh Cung, former head of the Central Institute for Economic Management, described the 8% target for 2025 and double-digit growth in the following years as highly ambitious. He emphasized that achieving such targets requires thinking and acting differently at both business and government levels.

“A well-designed institutional framework expands growth opportunities, fosters innovation, and creates a dynamic economy,” Cung stated. However, he noted that Vietnam has struggled to make meaningful regulatory breakthroughs, leading to stagnation in some areas.

“Over the years, we have failed to achieve true breakthroughs, making institutional barriers the bottleneck of all bottlenecks. Although we have chosen the right strategies, implementation has been ineffective, resulting in deadlocks. Now is the right time for institutional reform,” he asserted.

Cung advocated for simplifying bureaucracy and removing outdated legal constraints, particularly in regulated business sectors. He proposed shifting from pre-approval requirements to post-audit mechanisms to enhance efficiency.

Vietnam must act now to maintain long-term economic momentum

 
Echoing this sentiment, economist Tran Du Lich highlighted that Vietnam has never had such strong national confidence in its development prospects. The current period is a golden opportunity, but also a period of immense pressure to ensure growth.

Historically, Vietnam has faced external pressures to reform. In 1986, economic hardship forced the country to open its economy. Today, the challenge is different: without rapid growth, Vietnam will struggle to reach the ranks of advanced economies by 2045.

“In a decade, Vietnam will no longer benefit from a young labor force. We risk becoming a country that ‘gets old before getting rich.’ Unlike past crises, today’s challenge is the nation’s own ambition to become a developed country. There is no second chance,” Lich warned.

To achieve high growth, Lich emphasized the need for decentralization. He proposed allowing local governments greater autonomy in decision-making under the principle of "local decisions, local execution, local accountability." This approach, he argued, would create a true institutional revolution.

In Ho Chi Minh City, for example, resolving legal bottlenecks in over 500 real estate projects could contribute an additional 1-2% to national GDP growth. Many of these projects have secured financing but remain stalled due to regulatory hurdles. By addressing these issues, the city could unlock substantial investment and economic activity.

Vietnam stands at a crossroads. If the government implements bold reforms, the country could achieve its ambitious growth targets and solidify its position as a high-growth, innovation-driven economy. However, failure to act now may result in a stagnating economy burdened by an aging population before it has fully developed.

Anh Phuong