According to Dragon Capital, Vietnam ended 2025 with a clear acceleration in activity. Full-year GDP growth reached over 8 per cent, the second-highest since 2011, and momentum strengthened into year-end with Q4 growth of 8.5 per cent, the strongest Q4 in 15 years. Nominal GDP rose to $514 billion, up $38 billion from 2024, lifting per-capita income above $5,000.

Notably, this expansion was broad-based and led by industrial activities. Manufacturing value added grew 10 per cent, the fastest since 2019, while the Industrial Production Index rose 9.2 per cent, also the strongest since 2019. The Purchasing Managers’ Index eased slightly to 53 points in December but extended the positive run to six consecutive months, with business confidence at a 21-month high.

Domestic demand also strengthened, with retail sales and service revenues up 9.2 per cent in nominal terms, led by accommodation and food services at 14.6 per cent, alongside record international arrivals of 21.2 million, the first time Vietnam has exceeded 20 million.

Policy room remained supported by stable inflation and strong fiscal performance. Headline and core inflation averaged 3.3 per cent and 3.2 per cent in 2025, both well within the 4.5 per cent ceiling, while unemployment remained low at 2.2 per cent. State budget revenue reached 134.7 per cent of the government’s target, allowing public investment disbursement to rise sharply into year-end, reaching $32.3 billion.

In parallel, foreign investment disbursement rose to $27.6 billion, a five-year high and up 9 per cent on-year, while registered foreign direct investment held steady at $38.4 billion. On the external side, trade also hit a new milestone with turnover at $930 billion, up 18.2 per cent on-year. Exports rose 17 per cent to $475 billion, supported by a 48.4 per cent jump in electronics and computer products, while imports rose 19.4 per cent to $455 billion, leaving a trade surplus of $20 billion.

Equity markets reflected this stronger macro backdrop, with the VN-Index reaching an all-time high of 1,805 on December 25 and ending the year at 1,784, up 5.9 per cent on-month and 38.8 per cent for 2025 in $ terms, the strongest annual performance since 2017. Domestic participation remained the primary driver, absorbing sizeable foreign selling.

Foreign investors recorded net outflows of about $5.2 billion in 2025, the largest annual sell-off on record, although December saw a meaningful shift, with foreign investors net buyers in more than half of trading sessions, resulting in a net inflow of $90.5 million for the month.

"While it is too early to draw firm conclusions, the change in tone is consistent with improving sentiment ahead of Vietnam’s likely FTSE emerging market inclusion in September, and continued regulatory reforms aimed at an MSCI upgrade by 2030," Dragon Capital said.

Looking to 2026, the key question for investors is whether this broader growth base can be sustained. The combination of accelerating manufacturing, strengthening consumption, record tourism and firm investment flows provides a constructive starting point for earnings and market confidence. Over the next 3-6 months, the durability of export momentum, the pace of reform implementation, and FX movements will be the key swing factors to watch.

In addition, recent directions on developing the state economic sector are expected to support more productive use of public resources by improving the efficiency and accountability of state capital allocation, and strengthening state-owned enterprises’ role in strategic investment. Together, these measures can add further to an already strong growth foundation.