Vietnam Economic Update Report, Q3 2025

Vietnam’s growth engine shifts into a higher gear in Q3 2025

GDP rose 8.23% YoY, the fastest quarterly pace since 2011, led by manufacturing and services.

Vietnam’s economy demonstrated robust growth in Q3 2025, with GDP expanding 8.23% year on year (YoY), the fastest quarterly pace since 2011 (excluding the post-pandemic surge in 2022). This marked an acceleration from Q2’s 7.96% growth and kept the economy on track toward the government’s full-year target of 8.3 to 8.5%, notably above multilateral forecasts earlier in the year. Cumulatively, GDP in the first nine months (9M) of 2025 grew 7.85% YoY, the second-highest 9M rate in over a decade (only behind 2022’s 9.44%). The step-up in momentum came despite the 20% U.S. tariff on Vietnamese goods that took effect on August 7, which raised uncertainty for some export-oriented sectors. Growth was underpinned by stronger industrial output, vibrant services, resilient domestic demand, and steady FDI disbursement, while inflation stayed contained.

The structure of GDP remained balanced across the three main pillars. In 9M 2025, services accounted for about 42.9% of GDP, industry and construction for 37.6%, and agriculture–forestry–fishery for 11.3% (the remainder from taxes/subsidies on products). All three sectors expanded in Q3 and over 9M, with different speeds but broadly supportive contributions to headline growth.

• The agriculture–forestry–fishery sector grew 3.74% YoY in Q3 and 3.83% YoY in 9M, providing a stable base for food supply and rural incomes despite adverse weather.
• The industry and construction sector, Vietnam’s traditional growth engine, expanded 9.46% YoY in Q3 and 8.69% YoY in 9M 2025, contributing materially to the overall outturn given its roughly 37.58% share of GDP.
• The service sector maintained strong momentum and remained the largest contributor to growth, expanding 8.54% YoY in Q3 and about 8.48% YoY in 9M 2025.

Inflation dynamics remained supportive of growth. CPI in September increased 0.42% month-on-moth (MoM), 2.61% versus December 2024, and 3.38% YoY. Average CPI in Q3 2025 rose 3.27% YoY. Average CPI in 9M 2025 also rose 3.27% YoY, while core inflation increased by 3.19%. These readings indicate that underlying price pressures stayed moderate and broad within the policy comfort zone, helping preserve real incomes and consumption. Against this backdrop, the State Bank of Vietnam (SBV) kept policy supportive, ensured ample liquidity, and guided lending rates lower to foster production and household demand. While the dong faced some depreciation pressure amid a stronger U.S. dollar, SBV operations helped smooth FX volatility and preserve investor confidence. Credit growth remained robust, roughly high teens to about 20% on an annualized basis, channeling funds toward manufacturing, construction, and consumer sectors.

Overall, Vietnam’s third-quarter performance reaffirmed its position as one of Asia’s most dynamic economies. Strong industrial production, a vibrant service sector, and stable macro fundamentals combined to deliver the fastest growth rate in over a decade. As of September, cumulative GDP gains, steady inflation, and supportive monetary conditions positioned the economy to meet its full-year goals, provided domestic demand remains firm and global conditions do not deteriorate sharply. The balance between growth and stability achieved in Q3 2025 illustrates Vietnam’s resilience and its continued evolution toward a diversified, service-oriented, and high-value industrial economy.

U.S.–Vietnam trade: from tariff shock to framework détente

A new framework keeps 20% tariffs for now but opens zero-tariff windows on selected goods and anchors cooperation with major deals.

The third quarter of 2025 marked a turning point in Vietnam’s trade relations with the United States. The period began with uncertainty after Washington imposed a 20% tariff on Vietnamese goods effective August 7, with a 40% rate on goods suspected of transshipment through Vietnam. Many observers feared a sharp disruption to one of Vietnam’s most critical export markets, since the U.S. accounts for nearly a third of the country’s total export revenue. By the end of the quarter, Vietnam had not only weathered the tariff shock but also reached a preliminary framework with the U.S. that signaled a path toward renewed stability and cooperation.

The new U.S.–Vietnam Trade Framework, announced on October 26, aims to create a “reciprocal, fair, and balanced” trading relationship. While the 20% tariff remains in place for now, the agreement opens the door for zero-tariff treatment on selected Vietnamese goods pending further negotiations. In return, Vietnam committed to widening market access for U.S. products, adopting international standards in key sectors, and enhancing enforcement against transshipment and duty evasion. These commitments include greater alignment with U.S. vehicle regulations, streamlined approval for American medical devices and pharmaceuticals, and stronger customs cooperation. The framework shifts the tone of the bilateral relationship from confrontation to structured engagement, creating the conditions for more predictable trade rules that businesses can plan around.

Major commercial deals helped anchor this policy shift. Vietnam Airlines finalized an order to purchase 50 Boeing aircraft worth over USD 8 billion, one of the largest aviation contracts in the country’s history. Additional memoranda of understanding were signed for U.S. agricultural exports, including soybeans, corn, and meat products, collectively valued at several billion dollars. These transactions reduce the bilateral trade imbalance and demonstrate tangible economic cooperation. For both sides, they provide political and commercial ballast at a time when global trade tensions remain high.

For companies operating in Vietnam, the framework carries several practical implications. First, firms should prepare for a prolonged period of elevated tariffs, since the 20% rate will likely remain through at least early 2026. Exporters to the U.S. should assess which product categories might qualify for future tariff exemptions under the framework and adjust pricing and sourcing strategies accordingly. Second, the U.S. has indicated it will intensify origin verification and anti-transshipment checks, especially for electronics, textiles, and furniture. Robust documentation and supplier audits to prove genuine Vietnamese origin are essential. Third, Vietnamese manufacturers should diversify export portfolios toward the EU, Japan, and ASEAN, which continue to expand under existing free-trade agreements, reducing reliance on the U.S. market during the transition.

Despite short-term headwinds, the framework is an opportunity for Vietnam to move up the value chain and strengthen institutional trade practices. The government has accelerated customs modernization and digitalization to comply with international standards. Domestic enterprises are investing in compliance systems, traceability tools, and sustainability standards to maintain market access. These changes, although demanding at first, will improve Vietnam’s long-term competitiveness and integration into global supply networks.

Macroeconomic impacts appear manageable so far. Export growth to the U.S. slowed modestly late in Q3 but remained positive, contributing to an overall export increase of 18.4% YoY during the quarter. Electronics, agricultural goods, and machinery shipments performed well and partially offset declines in footwear and textiles. The trade surplus of USD 16.8 billion in the first nine months helped stabilize foreign reserves and the exchange rate. The government’s diplomatic and policy response also reassured investors and supported high-tech FDI inflows during the same period.

Q3 2025 was a quarter of adjustment and recalibration rather than retreat. Vietnam showed resilience under tariff pressure and agility in turning a potential trade crisis into an opportunity for strategic realignment. The emerging trade framework with the U.S. points to a more balanced, transparent, and cooperative phase in bilateral relations, one that could redefine Vietnam’s role in global supply chains over the coming years.