"Export Grab" Boosts Vietnam's Q2 GDP Growth by 7.96% Year-on-Year, Exceeding Expectations

Vietnam's economy achieved strong growth in the second quarter, primarily due to foreign buyers accelerating purchases ahead of the U.S. threat to impose high tariffs. This growth exceeded economists' expectations, highlighting the direct impact of trade policy uncertainty on global supply chains.

On July 5, the General Statistics Office of Vietnam announced that the GDP for the second quarter grew by 7.96% year-on-year, significantly surpassing the market expectation of 6.85% and also higher than the first quarter's 6.93%. Vietnam's exports in the second quarter increased by 18% to USD 116.93 billion, resulting in a trade surplus of USD 4.41 billion, which became a key factor driving economic growth. The data shows:

• Imports in the second quarter grew by 18.8% to USD 112.52 billion, achieving a trade surplus of USD 4.41 billion.

• Industrial production in the second quarter grew by 10.3% year-on-year, indicating active manufacturing activity.

• Exports in June grew by 16.3% year-on-year, slightly lower than the market expectation of 18.1% and the previous value of 17%, but still maintained double-digit growth.

• Imports in June grew by 20.2% year-on-year, exceeding the previous value of 14.1% but lower than the expected 23.1%.

• Industrial output in June grew by 10.8% year-on-year and 4.1% month-on-month.

According to Xinhua News Agency, Trump stated that the U.S. and Vietnam reached a trade agreement, with all Vietnamese exports to the U.S. facing at least a 20% tariff, and that the U.S. would "fully open its market." When Trump announced the "Liberation Day" tariffs in April, he threatened to impose import tariffs as high as 46% on Vietnamese goods, which is considered one of the highest rates globally.

Faced with such high potential trade barriers, foreign buyers rushed to place orders before the tariffs took effect, directly driving Vietnam's export growth in the second quarter. After the signing of the new U.S.-Vietnam trade agreement, analysts are optimistic about Vietnam's future prospects, believing that the trade agreement will help the government accelerate industrial upgrading.

Analysts Optimistic About Future Prospects

Fitch Ratings stated that Vietnam's exports and investments will remain strong for the remainder of this year. Vietnam's GDP growth of 7.96% in the second quarter is close to the Hanoi-set target of at least 8% for the entire year. The General Statistics Office of Vietnam stated:

Against the backdrop of global and regional economic uncertainty, the economic performance in the first half of this year has been positive, close to our target.

At the same time, the conclusion of the trade agreement will provide greater certainty for Vietnam's economy, helping the government accelerate industrial upgrading and shift exports from low-margin products to high-value-added products such as semiconductors. The agency noted:

Under the new 20% tariff, we believe the government will accelerate industrial upgrading, shifting exports from low-margin products to high-value-added products such as semiconductors.

Dominic Scriven, founder and chairman of investment company Dragon Capital, stated that the trade agreement is a "net positive," and the potential impact on GDP is not as concerning as previously thought He said:

As the risks in foreign trade have eased, attention can return to the country's core growth engines—domestic and private sector economies