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Helping you make better choices
• Richard Burrage is the founder of and board advisor to
Cimigo, a market research firm founded 22 years ago.
• Richard, a UK national, has resided in Vietnam with his three
children since 1997.
• Cimigo has been helping clients make better commercial and
marketing choices for 22 years.
• If you want to know more, just drop us a note at
ask@cimigo.com.
• You can download this presentation at www.cimigo.com.
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What will fuel Vietnam’s growth over the next decade?
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Eight reasons that Vietnam will prosper in the next decade
1. GDP growth averaged 5.9% over the past ten years.
2. More sophisticated production. Increased FDI and exports. Global interconnectivity.
3. Domestic tourism thrives and international recovers.
4. Consumer retail demand challenges.
5. Rising household affluence.
6. Financial inclusion and digital payments.
7. The growth of the digital economy - is now at US$36 billion.
8. Working age population, high labour participation and a low dependency ratio.
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GDP growth averaged 5.9% over the past 10 years
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What % of Vietnam’s exports are high-tech?
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Manufacturing seeks to mitigate overreliance on China
• Exports show strong growth (14% in 2024), with 44% local value-added.
• 4% of Vietnam’s exports of manufactured goods were high-tech products in 2003. In 2023, they accounted
for 40%. Notably, local value-added on high-tech products is at 16% but is growing.
• Vietnam has 16 free trade agreements abound. Vietnam’s global interconnectivity in 2024 was 182%.
• Interconnected global trade is defined as imports plus exports as a % of GDP.
• Moving towards greater value-added production is challenging. Key barriers include managerial staffing
shortages and inferior infrastructure impacting logistic costs.
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100.47 million US$431 billion US$4,293 Retail sales goods 77.7 million 86.1 million 69.9 million
GDP 7.1% growth GDP/capita & services users users users
US$255 billion -4.2%
(Up 2.3% in VND terms)
2024 progress
494,310 new
US$36 billion 98% smartphone US$1.49 billion passenger 39,000 new 79% banked
internet economy national all advertising cars (+22%) apartments adults 18+
8% of GDP adults 15+ 2,900,000 new (HCMC and Hanoi)
motorbikes (+14%)
Sources: 2024 data points. GSO, Global Demographics, Cimigo surveys, Savills, Media estimates post discounts, SBV, MCI , We Are Social, VAMA, TC Motors, VinFast, VAMM (VC250225) 9
Domestic tourism thrives and international recovers
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Domestic tourism thrives and international recovers
Inbound international tourists to 17.6 million in 2024 (up 40%).
Source: Vietnam National Authority for Tourism (VNAT)
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Consumer retail demand challenges
(retail goods and services account for 55% of GDP)
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Consumer retail demand has a sluggish 2.3% growth
Goods up 1%, Services up 7%
This is far below inflation; volume has contracted. In US$ equivalents, total goods and services contracted -4.2% in 2024.
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Lower consumer sentiment and increased savings
• Consumer sentiment in 2024 was 13 percentage points below 2019.
• Household saving rate has risen from an estimated 8.5% in 2019 to 10% in 2024. Consumer retail bank
deposits have increased by an estimated 4.7% in 2024.
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Vietnam consumer retail sales are muted
Consumer confidence muted
1. Local consumer sentiment and demand are muted.
2. Consumer price inflation is hitting household budgets. The official inflation basket does not fully represent consumers’
shopping baskets.
3. Higher interest rates hit consumer lending, credit purchases and household income.
4. Consumers rebuilding own savings following Covid lockdown depletions.
Consumer spending has undergone a behavioural shift to thrift
1. Delayed or halted high-ticket value purchases.
2. Reduced discretionary entertainment expenditure.
3. Increased savings.
4. Consumer goods shoppers have sought value and steered away from premium products. They have spurned premium
propositions. Their thrift impacts necessities such as a carton of milk as much as it does more discretionary spending.
5. Winners in this market have found stability or limited growth through a strong value proposition.
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Short-term expectations for Vietnam
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The macro-economic data paints a beautiful picture
Foreign direct investment, industrial production, exports, global interconnectivity
and a substantial trade surplus bode well for the economy.
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But in US$ terms it is not as positive.
Domestic consumer demand was flat in 2024.
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Expect continued short-term volatility
• Vietnam’s economy starkly contrasts impressive headline GDP growth with muted consumer demand.
• The currency devalued nearly 7% in 2024.
• Foreign direct investment, industrial production and exports bode well.
• A bureaucratic impasse impeded business sentiment and infrastructure spending in 2024. Major
government reform is underway in Q1 2025 and is expected to streamline administrative processes and
improve licensing and public expenditure disbursement.
• Cimigo‘s Vietnam GDP 2025 growth forecast is 6.6%.
• Cimigo expect a gradual improvement in consumer demand during 2025 – but only marginally above
inflation – at between 4% and 6%.
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Traditional trade has seen its share of sales fall
from 100% in 2000 to 62% today.
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Traditional trade saw an absolute decline in sales
for the first time in 2024
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Online shopping accounted for 11% of retail goods sales in 2024
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Which category of modern trade stores added the most
new outlets over the 24 months?
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Organised modern trade developments
• Modern trade’s contribution to retail
sales has moved from 15% in 2005 to
27% in 2024.
• 2024 saw an 11% increase in outlets
(vs. 24 months prior).
• Most extensive closures were at
An Khanh Pharmacy (-179
outlets).
• Most expansive was FPT Long
Chau Pharmacy (+796 outlets).
• Hasaki (beauty, health and
wellness) is also expansive (+136
outlets)
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25
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What % of adult women have undergone aesthetic
cosmetic surgery?
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28
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Rising household affluence
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Consuming ABCD class are 56% of all households
15.8 million households have a monthly income above US$592 (VND 15,000,000), classified as ABCD economic class.
This equates to 56.2 million people.
Source: Cimigo
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2024 wealth: Low incremental change over 2023
• 5 billionaires. Down 17%.
• 1,470 Ultra high net worth (>30 US$ million). Up 2.0%.
• 66,901 millionaires. Up 2.2%.
• 6,183,408 households =>USD1,000 monthly income. Up 1.5%.
• 13,518,160 households US$500-US$999 monthly income. Up 0.5%.
• Diaspora remittances US$18.2 billion. Down 12%.
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Sources: 2024 data points. Knight Frank, Forbes, SBV, Cimigo.
How much money was spent sending Vietnamese
students overseas in 2024?
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US$5.1 billion spent educating children overseas in 2024
Sources: Open Doors, Australian Govt, JASSO, CBIE, KESS, HESA, ICEF, UIS, MOET, World Bank
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Middle-class acceleration.
Migration and lower birth rates means that households
are smaller and wealthier.
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Financial inclusion is near-universal and
digital payment supremacy is nigh.
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Digital payment is dominant. Nearly 40% use bank apps in their
latest payment.
Latest payment method (%)
Based on all bank user N = 2,111
Bank app_net 37
• Digital bill: a QR code
Link the bank app to website or e-commerce platform 16
includes all of the
Manual transferring via bank app 11 information for
QR code via bank app - digital bill 6 transferring; the user
QR code via bank app - manual bill 4 does not need to input it.
E-wallet_net 31
Link the wallet to websites or e-commerce 11
• Manual bill: a QR code
Manual transferring via e-wallet 12
that just includes the
QR code via e-wallet - digital bill 6 account number; the
QR code via e-wallet - manual bill 2 user needs to input the
Bank card_net 18 amount of money.
Debit card 12
Credit card 6
Cash 15
Source: Cimigo Retail Banking Vietnam 2024
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Question. Think of the latest spending (any product and services), Which payment method did you use?
Domestic stock trading accounts up 28%
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The digital economy is valued at US$ 36 billion today,
reaching 8% of GDP.
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Digital transformation, digital economy at US$36 billion in 2024
US$36 billion 14% 59% 16% 10%
Internet economy Online travel Online Ads, media, games Ride hailing and
8% of GDP shopping food delivery
US$3 billon in 2015 at 1.7% of GDP.
Source: GSO, Temasek, Bain, Google, Cimigo
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E-commerce is dominated by Shopee.
TikTok is a rapidly growing challenger.
E-commerce platfrom sales contribution %
1%
100% 4%
25
8% 6% 4%
12% 10%
8%
90% 11% 12%
Estimated % share of value
15%
17% 12% 22
80% 20
20%
14% 16%
70% 14%
16% 19%
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US$ billin total
60% 16% 15
23% 19%
24% 14 12%
50%
23% 13
20% 4%
40% 2% 10
30% 8
46% 48%
20% 42% 5
35% 38%
32% 5
10%
0% -
2019 2020 2021 2022 2023 2024
Shopee TikTok Facebook Others Lazada Tiki Value US$ Billion
Source: Company releases, Metric.vn, GSO, Temasek, Bain, Google, Cimigo
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Which explanation for Vietnam’s rapid growth enables all else?
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Vietnam’s population structure
• A significant workforce. The
working population is 62% of the
total in 2025. Half of the working
population is aged 20 to 39 years.
• A high female participation in the
workforce. 88% amongst females
20 to 64. Just 40% in Indonesia and
25% in India do the same.
• A young workforce. 49% in 2025
are between 20 and 39 years old.
• A cheap workforce. In 2025, the
minimum monthly wage in Saigon is
US$198, just 54% of the minimum
in Guangzhou, which is US$370.
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The true demographic dividend is a low dependency ratio
96% men (20 – 64 years) work 88% women (20 – 64 years) The working population
work is 62% of the total in 2024
• Highest % of the working population in the region. It significantly lowers dependency ratios to just 0.64 per employed
person. This gives GDP a huge boost. Urban working adults have, on average, 1.67 sources of income.
Source: GSO, Global Demographics, Cimigo
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More women work in Vietnam than anywhere else in the region.
Vietnam enjoys a huge demographic dividend
owing to the low dependency ratios on earners.
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Which is the fastest-growing age group in Vietnam?
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The over-50s have grown from 18% of the population in 2010
to 28% in 2025.
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Decelerating birth rates, under 14s and pester power
The demographic that drives
much of mums’ purchase
behaviour has commenced a
slow decline.
The average number of
children born to a woman
over her lifetime was 2.5 in
2000 and 1.91 in 2024. It was
lower still in the South-East at
1.39 in 2024.
Vietnam’s youth has provided
an unrivalled dynamism.
We now need to consider
making better choices for the
silver generation.
Source: GSO, Global Demographics, World Bank, Cimigo
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Silver generation is fastest growing age segment going forward
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When will Vietnam’s demographic advantage fade?
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A staggering drop in the birth rate
and an ageing population will take hold in the 2030s.
Elderly dependents will become a key challenge in the 2040s.
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Long-term expectations for Vietnam
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Eight reasons that Vietnam will prosper in the next decade
1. GDP growth averaged 5.9% over the past ten years.
2. More sophisticated production. Increased FDI and exports. Global interconnectivity.
3. Domestic tourism thrives, and international recovers.
4. Consumer retail demand challenges.
5. Rising household affluence.
6. Financial inclusion and digital payments.
7. The growth of the digital economy - is now at US$36 billion.
8. Working age population, high labour participation and a low dependency ratio.
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