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Vietnam’s National Assembly concluded a high-stakes session (Feb 12-19), approving key policies to accelerate economic expansion, enhance efficiency, and unlock investment potential. With global uncertainties rising, policymakers are focusing on the local economy where decisive action can make differences.
- Streamlining Government for Efficiency
The structure of state administration is being streamlined with a reduction from 18 to 14 ministries. The government targets to lower the size of ministries and agencies by 15-20%. This long-overdue reform frees up fiscal resources and enhances regulatory efficiency, creating a more business-friendly environment. - Raising the Growth Target to 8%
The 2025 GDP growth target has been raised to 8%, supported by a strong push in infrastructure investment. To facilitate this expansion, authorities have set a 16% credit growth target, ensuring capital availability for businesses and large-scale projects. However, this expansionary stance is expected to come with higher inflation, though manageable thanks to persistently low gasoline prices and a decline in rice prices. - Investment policy for a $8.3B Railway to Strengthen Trade
The Lao Cai – Hanoi – Hai Phong railway project, a critical infrastructure upgrade, will improve logistics in the northern industrial zones, reducing transport costs and enhancing trade connectivity with China. Recall that in the November 2024 session, the National Assembly also approved the $68 billion North-South high-speed railway, reinforcing a long-term commitment to modernizing transport infrastructure and improving economic connectivity. - Special Mechanism for Nuclear Energy Development
New policies are being introduced to facilitate nuclear energy development, ensuring long-term power security and stability for a rapidly growing economy. - Fast-Tracking Metro Development in Key Cities
Hanoi and Ho Chi Minh City will have greater flexibility in capital mobilization and project execution, expediting their metro expansion plans—totaling $77 billion in investments. - Pilot Program for Investment in Satellite Telecommunications Networks
The National Assembly has approved a pilot program allowing foreign investment in satellite telecommunications networks, with no restrictions on foreign shareholding ratios. This move is designed to attract large global enterprises to invest in Vietnam’s telecommunications sector. While specific operators have yet to be confirmed, SpaceX’s Starlink is a potential candidate, given its plan to invest $1.5 billion in Vietnam.
These developments underscore the materialization of the Doi Moi 2.0 reforms we analyzed earlier, reflecting a clear commitment to cutting inefficiencies, mobilizing capital, and ensuring infrastructure keeps pace with economic ambitions. For global investors, the message is clear: Vietnam is positioning itself for sustained high-growth opportunities. Although the risk of potential tariff under Trump’s presidency remains, we are in a better position than many other nations to navigate these challenges.
