MONTHLY REPORT (DECEMBER 2025)

A. MACROECONOMIC HIGHLIGHTS & FORECASTS

1. Vietnam’s Economy: A Bright Spot in Asia The Asian Development Bank (ADB) has raised Vietnam’s growth forecast for 2025 to 7.4% (up from the previous 6.7%), highlighting Vietnam as a bright spot in Southeast Asia.

Industrial Production (IIP): In the first 11 months of 2025, IIP increased by 9.3%. Key drivers include electronics (+8.5%), metal production (+15.5%), and automobiles (+22%).
Business Environment: There were 275,600 new and returning enterprises, a 26.1% increase year-on-year.
FDI Surge: Realized FDI reached $23.6 billion (+8.9%), the highest in the past 5 years. Manufacturing accounts for nearly 83% of this capital .

2. Global Economic Context 2026

Growth Slowdown: OECD and UNCTAD forecast global growth to slow to 2.6% – 2.9% in 2026 due to financial pressures and geopolitical instability.
Fed Policy: The US Federal Reserve cut interest rates by another 0.25% on Dec 9, bringing rates to 3.50-3.75%. This helps reduce exchange rate pressure on the VND and lowers borrowing costs for Vietnamese enterprises.
US Strategy: President Donald Trump announced a new “America First” National Security Strategy, prioritizing border control and re-industrialization. This may lead to stricter supply chain controls involving technology .

B. IMPORT – EXPORT & TRADE DEFENSE

1. Trade Records and New Opportunities

Performance: 11-month export turnover reached $430.14 billion (+16.1%) and imports reached $409.61 billion (+18.4%). The trade surplus stands at $20.53 billion.
Mexico Opportunity: Mexico passed a bill imposing 35-50% tariffs on goods from countries without an FTA with them. Since Vietnam is a CPTPP member, this creates a massive advantage for Vietnamese textiles and footwear to replace Chinese goods in Mexico. MoIT identifies Mexico as the #1 priority market in Latin America for 2026.
US-Korea Spillover: The US reduced tariffs for South Korea to 15%. This is driving Korean conglomerates to restructure supply chains, potentially increasing FDI into Vietnam for electronics and components to serve the US market.

2. Challenges and Risks

Brazil’s Robusta Boom: Brazil forecasts a record Robusta coffee output of 20.8 million bags (up 4.3%). With superior technology and logistics, Brazil threatens Vietnam’s position. Vietnam risks losing pricing power if it doesn’t shift strategy from raw exports to high-quality/processed coffee .
Tech Supply Chain: New US security strategies and export controls on high-tech could increase compliance costs for Vietnamese electronics firms dependent on regional supply chains .

C. ENERGY & GREEN TRANSITION

1. Key National Energy Projects Approved On Dec 2, the Prime Minister issued Decision 2634/QD-TTg approving the list of key national energy projects. Notably, this includes:

Nuclear Power: Two plants in Ninh Thuan (2,000 – 3,200 MW each) slated for 2030-2035.
LNG & Renewables: Quang Ninh LNG (1,500 MW), Ca Na LNG, and large pumped-storage hydropower projects (Bac Ai, Don Duong) .
Goal: To ensure energy autonomy and align with the global trend after the EU decided to stop importing Russian gas by late 2027.

2. EU Green Regulations The EU released final technical guidelines for CBAM (Carbon Border Adjustment Mechanism) and EUDR (Deforestation Regulation). Vietnam is currently classified as “low risk,” which simplifies procedures, but businesses must urgently invest in traceability and emission measurement systems to remain competitive long-term.

D. DOMESTIC MARKET & POLICY

1. Consumption and Inflation

Retail Sales: Total retail sales in 11 months reached 6,377 trillion VND (+9.1%). Tourism revenue surged by 19.9%.
CPI: The Consumer Price Index in November increased by 0.45% MoM and 3.28% YTD. Key drivers were transport costs (+1.07%) and food prices (+1.33%) due to flood impacts.
Promotion: MoIT launched “Vietnam Grand Sale 2025” (Dec 1, 2025 – Jan 18, 2026) to stimulate year-end consumption.

2. New Policies Effective December 2025

Digital Transformation: MoIT issued the Digital Transformation Strategy 2025-2030, focusing on a “clean, live” data system.
Foreign Currency Accounts: Circular 39/2025/TT-NHNN allows 12 specific cases for opening foreign currency accounts abroad (e.g., for loans, contracting, or overseas offices).
Water Resources: Decree 290/2025/ND-CP increases penalties for water pollution and unauthorized exploitation, effective Dec 25.

E. STRATEGIC RECOMMENDATIONS FOR 2026

1. For the State

Mexico Strategy: Immediately organize trade promotion delegations (textile, footwear, mechanics) to Mexico. Establish a special monitoring mechanism for CPTPP C/O issuance to prevent origin fraud (“laundering” goods from China) .
Energy Security: Accelerate the implementation of LNG, offshore wind, and nuclear power projects. Complete the legal framework for the carbon market .
Public Investment: Strive for 100% disbursement of public investment capital; launch key projects on Dec 19.

2. For Businesses

Coffee Sector: Shift from competing on price with Brazil to building High-Quality Robusta brands and investing in deep processing (instant/roasted coffee) .
Risk Management: Prepare for logistics disruptions and exchange rate fluctuations. Monitor the US-China market dynamics closely and build reserve funds.
Digital & Green: Invest in supply chain digitization and green compliance (CBAM/EUDR) to meet EU and US standards.

Report on the International and Domestic Socio-Economic Situation_December 2025 Download