CATEGORIES

© Copyright 2004; Hanoitimes - Economic and Urban Newspaper;

The tribune of Hanoi People’s Committee

Publication Permit: 29/GP-CBC

Editor - in - Chief: Nguyen Thanh Loi

Managing Editor: Ta Thu Giang

Email : thugiang@hanoitimes.vn

Head Office: 21 Huynh Thuc Khang Street, Dong Da District, Hanoi

Branch Office: 221 Tran Phu Street, Ha Dong District, Hanoi

WORDS ON THE STREET 70th anniversary of Hanoi's Liberation Day Vietnam - Asia 2023 Smart City Summit Hanoi celebrates 15 years of administrative boundary adjustment 12th Vietnam-France decentrialized cooperation conference 31st Sea Games - Vietnam 2021 Covid-19 Pandemic
Home / Economy / Trade - Service
Vietnam leads ASEAN as the group reclaims competitive niche: HSBC
Ngoc Thuy 17:29, 2019/02/22
Despite Vietnam`s economic boom in recent years, Vietnamese workers’ wages remain hugely competitive, contributing positively to the economy’s competitiveness.
With China’s wages rising rapidly over time and recent trade tensions prompting supply chain rejigging, ASEAN – with Vietnam leading the pack, is now recapturing its competitive niche as the Asia’s export powerhouse, according to HSBC’s latest report. 
Up until the mid-1990s, ASEAN broadly matched China in terms of export volume growth of goods. Then, not only did China surge ahead, especially in the mid-2000s, but ASEAN actually downshifted from its previous pace. 

Since the global financial crisis, the gap between the two has again narrowed, until ASEAN started pulling ahead in from 2016 onwards with the US – China trade tension and rising wage in China. 

There are plenty of factors, of course, that determine an economy’s competitiveness: the real exchange rate, quality of infrastructure, regulatory environment, among others, but wages, too, are part of the mix. And in the last few years alone, with Chinese workers’ income continuing to soar, the gap with Southeast Asia has continued to widen. 


Among ASEAN countries, Vietnam leads the way, with Malaysia and Thailand pulling up as well. Despite its boom in recent years, its wages remain hugely competitive. Additionally, between 2012 and 2017, in a mere five years, Malaysia and Thailand have seen a huge increase in their competitiveness, with wages in the latter now about 25% below China’s. 

As ASEAN’s exports are booming, foreign direct investment into the region has picked up noticeably. Based on the report’s estimation, last year was the first time since 1991 that FDI inflows into ASEAN exceeded those into China. 

HSBC predicted Vietnam’s GDP to grow 6.5% in 2019 and 6.3% in one year later, following the 10-year high of 7.08% in 2018. The country, however, is projected to remain the fastest-growing economy in ASEAN. 
Comments
Other news
08:41, 2025/01/11
Vietnam-Laos Industrial Park: New direction to strengthen bilateral ties
Numerous Vietnamese projects in various sectors have effectively contributed to Laos' development, creating jobs and improving the livelihoods of tens of thousands of local workers.
22:19, 2025/01/09
Hanoi's foreign trade turnover hits US$60.1bn in 2024
The city will continue to support businesses in exploring new markets, capitalizing on the Free Trade Agreement of which Vietnam is a member.
11:46, 2025/01/09
Vietnam confident of achieving 8% growth rate in 2025
Key drivers of Vietnam’s growth include institutional reforms and decentralized governance.
14:34, 2024/12/26
UK’s accession to CPTPP to benefit Vietnam’s exports in 2025
Vietnam, in particular, will gain further access to a high-quality market, complementing its connections with Japan, Canada, and Australia.
16:41, 2024/12/16
Hanoi seeks greater efficiency in e-commerce tax management
Hanoi's e-commerce tax administration is expected to be significantly tightened in the near future.
17:34, 2024/12/15
Hanoi's wet markets in decline amid changing consumer behaviors
Local consumers prefer shopping options that offer convenience and assurance of product origin.