Ho Chi Minh City towards the 1st Party Congress: Ho Chi Minh City with the vision of an 'international megacity'

If we look at what Ho Chi Minh City has achieved since the Covid-19 pandemic so far, the growth target of 8.5% this year, although very challenging, and reaching double digits in the future is completely reasonable.

Strong recovery after the pandemic

Since the end of June, the Ho Chi Minh City People's Committee has set a growth target of 10.3% in the second half of the year, so that the total gross regional domestic product (GRDP) for the whole year will reach 8.5% or more. This target is mentioned in the plan to implement key tasks to promote socio-economic growth in the last months of 2025, just issued by the Ho Chi Minh City People's Committee. Recently, at the 4th Ho Chi Minh City Party Committee Conference, term 2020 - 2025, the city's double-digit growth target was also mentioned. Also at the conference, Secretary of the City Party Committee Tran Luu Quang proposed to propose solutions as well as continue to remove bottlenecks, improve the investment environment, proactively attract strategic investors and strengthen connections, and coordinate effectively with localities in the region so that Ho Chi Minh City can develop strongly in the coming time.

With rapidly developing infrastructure and connections to neighboring areas, Ho Chi Minh City will have the opportunity to maintain its position as the country's economic locomotive.

Photo: Nhat Thinh

In the first half of the year, Ho Chi Minh City's economic growth rate is estimated to increase by over 8% - this is the highest increase compared to the same period since 2020. By the end of August, after merging with Ba Ria-Vung Tau and Binh Duong , Ho Chi Minh City's economy continued to maintain a bright color. In particular, thanks to the strong growth of the "three-horse carriage" of industry, services and foreign direct investment (FDI). According to the Ho Chi Minh City Department of Finance, the industrial production index in August continued to increase compared to previous months and increased by more than 10% over the same period last year. Notably, the production index of 4 key industries in 8 months increased by more than 11% over the same period in 2024. The Department of Finance assessed that maintaining a good growth rate shows the recovery and positive development of the city's industry in the face of global economic fluctuations. "The fact that key and traditional industries have recorded significant growth shows the effectiveness of the city's support policies and industrial development strategies," commented a representative of the Ho Chi Minh City Department of Finance.

Not only the industrial sector, the city's retail and consumer services sectors also increased sharply, nearly 16% over the same period. Of which, retail sales of goods are estimated at nearly VND85,000 billion, up more than 17%; accommodation and catering services are over VND19,000 billion, up nearly 21%. In particular, travel services continue to be a bright spot with an estimated growth rate of nearly 39% over the same period. Similarly, foreign investment attraction in the city in the first 8 months reached nearly 6.9 billion USD, up more than 58% over the same period.

Looking back at what Ho Chi Minh City has steadfastly achieved in the past 5 years, it can be affirmed that the above growth target is within reach. Remember when the Covid-19 pandemic occurred, the city was one of the localities that suffered the most severe losses in terms of economy, society, and people. However, just over a year after the pandemic, at the end of 2022, the city showed a spectacular socio-economic recovery, from a deep decline of 5.36% in 2021, GRDP in 2022 jumped more than 9%, the growth rate was fast and higher than the general growth rate of the whole country, mainly thanks to the growth of production, services... Notably, in the 2 years of the pandemic, Ho Chi Minh City witnessed thousands of businesses leaving the market, temporarily suspending operations due to difficulties... but after only one year, the number of businesses returning to operation increased and the number of newly established businesses increased by more than 42%.

From those telling numbers, from 2023 to now, Ho Chi Minh City has returned to the "race", naturally and impressively reviving. By the end of 2024, GRDP is estimated to reach 1,178 trillion VND, in which revenue from the service and industrial sectors both increased by more than 7%.

By merging with Binh Duong and Ba Ria-Vung Tau, Ho Chi Minh City aims to become an "international megacity" of Southeast Asia, with GRDP per capita reaching about 14,000 - 15,000 USD by 2030, entering the top 100 best cities in the world by 2045.

Accelerating reform, focusing on private economy

Prof. Dr. Vo Xuan Vinh - Director of the Institute of Business Research, University of Economics Ho Chi Minh City - emphasized that to become an international, smart, green, sustainable and outstanding megacity, the digital economy must be focused on. The digital economy is the key for the city to escape the middle-income trap, increase foreign investment attraction, and promote private economic development in the new era. Ho Chi Minh City is ranked 2nd in the country in terms of innovation index, in the top 100 cities with the most dynamic innovative startup ecosystems globally and 6th in Southeast Asia. "This shows that the opportunity for outstanding growth and the possibility of rising to the leading position of the city is very large. In particular, the biggest advantage of the city is having a strong private enterprise team. 77% of the economic structure of Ho Chi Minh City (old) comes from the private sector, of which non-state investment capital accounts for approximately 68%. Clearly, the city is always a hot spot attracting investment resources and innovation. This structure has been promoting the digital transformation process, helping to improve the competitiveness of enterprises and expand participation in the global supply chain," commented Professor Vinh.

With rapidly developing infrastructure and connections to neighboring areas, Ho Chi Minh City will have the opportunity to maintain its position as the country's economic locomotive.

Photo: Nhat Thinh

In some ASEAN countries such as Indonesia, Thailand and Singapore, the private sector not only contributes to the GDP, but also has a strong development structure with a higher proportion of large enterprises. These enterprises play a leading role in the value chain, helping to optimize resources and improve the ability to integrate internationally.

Prof. Dr. Vo Xuan Vinh emphasized: "Ho Chi Minh City is the leading locality in the economy, contributing 1/3 of the country's GDP, it is necessary to have bold decisions to maintain its leading position on the one hand, and continue to accelerate with the whole country to enter a new era of double-digit growth on the other hand. In the immediate future, to attract private investment, foreign investment, develop geographical advantages to accelerate services, Ho Chi Minh City needs to focus on promoting administrative reform, simplifying unnecessary procedures as much as possible to minimize official and unofficial costs for businesses. With the advantage of a 2-level government, institutional reforms need to be given more special attention. Second, the city needs to implement policy packages to support funding for digital transformation businesses, and should not be delayed. In addition, encourage the development of high-tech agriculture, supporting industries and promote a stronger start-up movement".

The digital economy needs digital government, processing documents, making processes transparent so that businesses can easily access preferential policies as well as grasping difficulties to resolve them together with the government is necessary. "In my opinion, support policies in the new period, preparing to enter a new era of the nation, need to be concretized by highly enforceable legal documents. To do so, it is necessary to promote digital infrastructure, train high-quality human resources, and create a transparent environment where all businesses can easily adapt to digital transformation trends as well as global economic information," emphasized Professor, Dr. Vo Xuan Vinh.

The Ho Chi Minh City People's Committee requested each agency and unit to focus on implementing tasks and solutions to contribute to mobilizing and unleashing social investment resources of about VND 780,000 billion; total retail sales of goods and service revenue increased by 19.2%; exports increased by 24.3%; striving for 8.5 - 10 million international visitors, 45 - 50 million domestic visitors and total tourism revenue of about VND 260,000 - 290,000 billion.

Source: https://thanhnien.vn/tphcm-tien-toi-dai-hoi-dang-bo-lan-thu-i-tphcm-voi-tam-nhin-sieu-do-thi-quoc-te-185250919192312144.htm