FX.co ★ World Bank Cuts Vietnam’s 2025 Growth Forecast Amid Tariff Pressures

The World Bank has revised Vietnam's growth prediction for 2025, reducing it to 6.6% from the earlier estimate of 6.8% noted in March, which is significantly lower than the government’s target of 8.3%-8.5%. This adjustment reflects a cooling in economic activity as export growth stabilizes following a robust first half. The report highlights that, as an export-reliant nation, Vietnam is susceptible to decelerating global growth and decreasing demand from key trading partners. Additionally, uncertainty surrounding trade policies might negatively impact business and consumer confidence. This downgrade follows the imposition of a 20% tariff on Vietnamese goods by its largest export market, the United States, effective from August 7, alongside a 40% levy on third-country transshipments. Looking ahead, Vietnam is anticipated to experience a growth rate of 6.1% in 2026, before ascending to 6.5% in 2027, driven by a recovery in global trade and sustained manufacturing competitiveness. Meanwhile, Prime Minister Pham Minh Chinh has cautioned that trade tensions, geopolitical conflicts, and disruptions in supply chains are increasing inflationary pressures and affecting the exchange rate.