From a challenging 2023 and Q1, Vietnam is clearly back as ASEAN’s growth star, the bank said in its update “Vietnam at a glance: In its own league” released on Friday. Q3 growth came in at 7.4% year-on-year, beating HSBC and consensus expectations, according to the report. 

The outperformance continued to be led by manufacturing, which grew 11.4% year-on-year. This was corroborated by healthy trade data, with exports rising 15.3% year-on-year in Q3.

The bank noted that the trade recovery that was initially centered around electronics is showing signs of broadening out, with textiles and footwear exports rising 16.7% year-on-year.

HSBC experts held that while Typhoon Yagi likely played a role in weighing on export growth in September, the impact is expected to be short-lived.

Although there have been some signs of bumps in global trade, leading indicators such as manufacturing industrial production and imports continued to post double-digit year-on-year growth, supporting the view that the manufacturing sector will remain firm.

On FDI, Vietnam continued to attract foreign inflows as fundamental prospects remain positive. According to HSBC, capital flows into manufacturing are likely to remain resilient in the future, as Party General Secretary and President To Lam's visit to the US has attracted interest from various companies such as Meta. It went on to say that continued efforts to deepen ties with international partners will also act as a tailwind for further investment inflows, with Vietnam recently upgrading relations with France to a Comprehensive strategic partnership.

HSBC keeps its 2025 GDP growth forecast for Vietnam unchanged at 6.5%.