Vietnam Industry May 2020

Vietnam

Vietnam: Industrial output falls in May, albeit at reduced rate

May 29, 2020

Industrial output declined 3.1% compared to the same month a year earlier in May, which was a smaller contraction than April's 9.4% decrease.

May's result came on the back of a rebound in electricity generation and a smaller decline in manufacturing, likely as economic activity resumed following the lifting of lockdown restrictions.

Looking ahead, industrial production should continue to recover as economic activity ramps up. Moreover, the underlying strength of Vietnam’s industrial sector remains intact: Vietnam is an attractive low-cost base for manufacturing firms, including those looking to relocate from China due to the U.S.-China trade spat, thanks to a cheap workforce and business-friendly government.

FocusEconomics Consensus Forecast participants estimate that industrial output will grow 2.5% in 2020, which is up 1.3 percentage points from last month’s forecast. For 2021, panelists expect industrial production to expand 9.0%.


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Vietnam Industry May 20 20

Note: Year-on-year variation of industrial production index in %.
Source: General Statistics Office of Vietnam (GSO) and FocusEconomics calculations.


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