Vietnam Industry January 2021

Vietnam

Vietnam: Industrial output grows at quickest pace in three years in January

January 29, 2021

Industrial production expanded 22.2% year-on-year in January (December: +8.2% yoy). January's print marked the strongest increase since January 2018. The rise was largely due to faster growth in manufacturing output. In addition, electricity production also gained steam.

Meanwhile, the trend improved significantly, with the annual average growth of industrial production coming in at plus 5.1%, up notably from December's 2.6% reading.

This year, industrial production should pick up pace from 2020’s slowdown as economic activity recovers in key international markets. Moreover, the underlying strength of Vietnam’s industrial sector remains intact despite Covid-19: Vietnam is an attractive low-cost base for manufacturing firms, including those looking to relocate from China due to the U.S.-China trade tensions. However, uncertainty regarding the evolution of the pandemic and the rollout of vaccines across key international markets clouds the outlook.

FocusEconomics Consensus Forecast participants estimate that industrial output will grow 9.0% in 2021, which is up 0.1 percentage points from last month’s forecast. For 2022, panelists expect industrial production to expand 7.9%.


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Vietnam Industry January 2021 0

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


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