IMF Staff Completes 2025 Article IV Mission to Vietnam

IMF News, June 24, 2025

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An International Monetary Fund (IMF) team, led by Mr. Paulo Medas, held discussions for the 2025 Article IV consultation with the Vietnamese authorities from June 11-24, 2025.
The team exchanged views with Deputy Prime Minister Ho Duc Phoc, senior officials of the State Bank of Vietnam (SBV), the Ministry of Finance, the National Assembly, and other government agencies, and met with representatives from the private sector, think tanks, and other stakeholders.
Press Release No. 25/214. PRESS OFFICER: Pavis Devahasadin. Phone: +1 202 623-7100 Email: MEDIA@IMF.org. @IMFSpokesperson

2024 growth: 7.1 percent (rebound driven by robust exports, resilient foreign direct investment (FDI), and supportive policies).
Q1 2025 growth: 6.9 percent year-on-year.
2024 current account surplus: 6.6 percent of GDP.
Inflation in early 2025: described as "contained" (no numeric value provided).

Baseline/assumption: Projections follow the IMF April 2025 World Economic Outlook and assume high tariffs take effect in the third quarter.
Downside scenario (if high tariffs take effect): economic growth is projected to slow to 5.4 percent in 2025 and decelerate further in 2026.
Alternative (upside) scenario: if global trade tensions subside, the economic outlook would improve significantly.
Key external risks: escalation in global trade tensions; tightening of global financial conditions.
Key domestic risks: tighter financial conditions, high corporate indebtedness, potential re-emergence of financial stress.

Fiscal policy has room to provide greater support to cushion the impact of global shocks if needed.
Fiscal policy, supported by low level of public debt, should take the lead in cushioning the near-term impact especially under downside scenarios.
Recommended fiscal actions include accelerated implementation of public investment and strengthening social safety nets.
To maximize returns on large investments, it is critical to strengthen public investment management and adopt a sound macro-fiscal strategy to preserve the health of public finances.

Monetary policy has much more limited room and should be decisively focused on anchoring inflation expectations.
Allowing exchange rate flexibility will be critical as the economy adjusts to the external shock.
Some monetary easing could be considered if global interest rates decline as expected and inflation falls.
Vigilance is needed to monitor and act against inflation pressures that arise, including due to external shocks.
Recommendation to modernize the monetary policy framework to enhance its effectiveness and anchor stability, including by replacing credit growth limits with an improved prudential framework.

Further efforts are needed to strengthen financial sector soundness.
Priorities to bolster banking system resilience:
- Strengthening bank supervision.
- Build liquidity and capital buffers.
- Further improving the bank resolution framework.

The government’s plans for an ambitious reform agenda are welcomed and could boost medium-term growth, but implementation will be key.
Areas emphasized for reform and investment to raise medium-term growth:
- Institutional overhauls to enhance efficiency.
- Private sector strengthening and development.
- Infrastructure improvements (examples cited: logistics, energy).
- Functioning of capital markets.
- Education and training, and productivity enhancements.
Efforts to strengthen economic governance are essential, including strengthening the AML/CFT regime.
Vietnam’s rapid economic growth is outpacing the development of its economic statistics; urgent efforts are needed to close data gaps to support effective policymaking and risk management.

The team is grateful to the authorities for their warm hospitality and the candid and insightful discussions.
End-of-Mission press releases convey preliminary findings; the views expressed are those of IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Staff will prepare a report that, subject to management approval, will be presented to the IMF's Executive Board for discussion and decision.

Source: IMF Staff Completes 2025 Article IV Mission to Vietnam, June 24, 2025.