Vietnam Set to Overtake Thailand as Southeast Asia's Second-Largest Economy

Analysts predict strong growth will propel Vietnam past regional neighbour within the next decade

 

Vietnam is on track to become Southeast Asia's second-largest economy, surpassing Thailand, according to a new report from the Centre for Economics and Business Research (CEBR).

 

The economic think tank forecasts that Vietnam will rank behind only Indonesia in the region and climb to become the 20th largest economy globally by 2036.

 

The CEBR's World Economic League Table highlights Vietnam's current five-year plan (2021-2025), which anticipates an average annual growth rate of 6.5% over the next decade.

 

This growth is expected to be fuelled by its robust manufacturing sector, further integrated into international supply chains through trade deals and diversified exports.

 

Vietnam also has ambitions to achieve high-income status by 2045, requiring an average annual per capita growth of around 5%. The current five-year plan's projections align with this long-term objective.
  

However, the report notes that Vietnam faces considerable hurdles in reaching this goal, including a slowdown in global trade and a growing elderly population.

 

Addressing these challenges will require significant improvements in policy efficiency, particularly in sectors vulnerable to automation, technological advancements, and the impacts of climate change.

 

Separate data from the International Monetary Fund (IMF) indicates that Vietnam has already risen to become the third-largest economy in Southeast Asia this year, with a GDP of $571 billion.

 

This places it behind Indonesia and Thailand but ahead of Malaysia, the Philippines, and Singapore.
  

Looking ahead, the IMF projects that by 2027, Thailand's GDP will reach $692 billion, while Vietnam's will be $690 billion.

 

CEBR anticipates that Vietnam's economy will officially overtake Thailand's after 2028, positioning Thailand as the region's third-largest economy.

 

If the CEBR's forecasts prove accurate, Vietnam's economic output will exceed that of Poland, Switzerland, Belgium, and Australia by 2036.

(2025/05/05-00:00)