Growth only opens the way, reform goes far

At the online conference between the Government and localities on economic growth scenarios held on July 16, the Government gave specific figures that the whole country needs to achieve an economic growth rate of about 8.3-8.5% this year, creating momentum to reach double digits in the 2026-2030 period.

Thus, instead of previously determining that GDP must increase by 8% or more this year, the Government has specified a higher level. This is reasonable because in the first half of 2025, although the global economy struggled with tariff pressure, declining consumption and supply chain fragmentation, Vietnam still emerged as a rare bright spot with GDP growth reaching 7.52% - the highest in the same period in the past 14 years.

Vietnam's rise is not a random result but reflects the process of preparing the foundation for many years to maintain macroeconomic stability, improve the investment environment, promote trade negotiations and proactively grasp the wave of global supply chain shifts.

In the first 6 months of the year alone, Vietnam attracted more than 21.5 billion USD in FDI capital, up 32.6% over the same period; exports increased by 14.4%, creating a trade surplus of nearly 7.63 billion USD; bank credit increased sharply, supporting production and investment. Business confidence and financial markets improved significantly.

However, in the light of growth, there are still many dark spots, and challenges are accumulating that need to be identified early for timely solutions. First of all, growth is not really sustainable when it still depends heavily on the FDI and export sectors.

The domestic economic sector, especially small and medium enterprises, is still weak in the value chain, lacking capital, technology and low competitiveness. In addition, labor productivity and human resource quality have not kept up with the requirements of the transition. Vietnam is attracting high-tech capital flows but has not yet ensured enough technical human resources to receive them.

In addition, the infrastructure system and institutions are still bottlenecks. Incentive policies for green investment, digital transformation, and innovation are still at the orientation level, and have not yet formed a strong enough incentive framework.

Finally, external risks cannot be ignored, with US tariffs potentially having an indirect impact on supply chains, international interest rates yet to fall significantly, and fluctuations in exchange rates and global geopolitics that could see international capital flows reverse quickly if the domestic environment becomes unstable.

To quickly resolve these challenges, Vietnam needs to synchronously deploy a number of core solutions. First of all, promote the development of the domestic enterprise sector, especially small and medium enterprises, through preferential credit programs accompanied by requirements for technological innovation. At the same time, bottlenecks in land, planning, and environmental procedures need to be thoroughly resolved through pilot models of high-tech industrial zones with more flexible mechanisms than the general legal framework.

In addition, strong investment in high-quality human resources is not only the task of the education sector but must be a strategy linking the state - enterprises - research institutes with specific budgets and policies for each key industry such as semiconductors, automation, new materials. Promote the transformation of the growth model from processing to innovation.

It is necessary to encourage the formation of domestic innovation industrial clusters, where Vietnamese enterprises proactively research, design, produce supporting products and connect to the region. Proactively and selectively integrate, need to play an active role in setting new rules of the game on green supply chains, digital trade, and carbon taxes. This is the institutional space that determines competitiveness in the next 5-10 years.

Vietnam’s growth prospects stem from its rising position in the global value chain and an improving investment climate. Sustaining this momentum will require strong, rapid, and substantive reforms.

To maintain the momentum of the breakthrough, Vietnam needs to create modern institutions that can quickly adapt to new global standards such as digital trade, green transformation and global minimum tax. It is necessary to take advantage of the high growth period to promote strong reforms when there is still room for growth, consensus is easy to create and the spillover effect is greatest.

Growth only opens the way, reform goes further. High growth rate creates advantages in terms of trust and attraction with global investors but is only the beginning. If we take advantage of the right opportunity, promptly handle bottlenecks and improve internal competitiveness, Vietnam can completely rise to become a center of production, innovation and regional connectivity, affirming its position in the reshaping global economic order.

Dr. HUYNH THANH DIEN

Source: https://www.sggp.org.vn/tang-truong-chi-mo-loi-cai-cach-moi-vuon-xa-post804056.html