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Ho Chi Minh City economy

Tue, 29 Jul 2014. Last updated Wed, 17 Sep 2014 17:42

Ho Chi Minh is the most bustling and dynamic city in Vietnam. In the past years, Ho Chi Minh City economy constantly grows and reaches the significant achievements contributing to the development of Vietnam economy.

Located in the Southeast economy, Ho Chi Minh City plays the leading role in the Vietnam economy. The city occupies 0.6% of the country’s area and 8.34% of Vietnam’s population, but the GDP of Ho Chi Minh City accounts for 20.2% of the total GDP of Vietnam, 27.9% of the industrial output value and 34.9% the foreign projects. In 2005, the city had 2,966,400 employees from 15 years old to older. In 2011, the number was 4.000.900 labors. In the first 9 months of 2012, the GDP of the city reached VND 404,720 billion, an increase of 8.7%. In 2012, the GDP achieved about 9.2%, of which, the service sector reached 10.8%, the industry and construction achieved 9.2% and the agriculture and fishery reached 5%. GDP per capital achieved $ 3,700. The revenue in 2012 was estimated at VND 215,975 billion. The domestic revenue reached VND 109,500 billion, or about 88.81% of the estimate, the revenue from the import and export activities was VND 70.000 billion, or 88.72% of the estimate.

 

Starbucks in Ho Chi Minh City

 

In 2013, the total domestic product increased by 9.3% over the previous year. The added value of agriculture-forestry-fishery reached VND 7.769 billion, accounting for 1.02% of GDP, increasing 5.6%. The added value of the industry and construction achieved VND 310,641 billion, accounting for 40.6% GDP, an increase of 7.4% and the service sector reached VD 446,151 billion, making up 58.4% of GDP and increasing 10.7%. The increase level in the industrial index was estimated at 6.36% over 2012. The building production value in the whole year reached VND 152,556.2 billion at the current price, an increase of 5.8% over the previous year.

The economy in Ho Chi Minh City is diverse fields from mining, fishery, agriculture, processing industry, construction to tourism and finance. In term of the city’s economic structure, the public sector accounts for 33.3%, the non-state sector accounts for 44.6%, the rest is the foreign investment area. Among the economic sectors, the service industry has the highest proportion of 51.1%, the industry and construction account for 47.7%, the agriculture, forestry and fishery only make up 1.2%.

 

Industry

Phong Phu industry zone in Ho Chi Minh City

 

As of mid – 2006, 3 processing zones and 12 industrial parks in Ho Chi Minh City attracted 1.092 investment projects, including 452 foreign investment projects with the total invested capital of more than $ 1.9 billion and VND 19.5 thousand billion. The city also head of total foreign direct investment of Vietnam with 2530 FDI projects, the total capital of nearly $ 16.6 billion in the late 2007. In 2007, the city attracted more than 400 projects with nearly $ 3 million. In the ranking of the Provincial Competitiveness Index of Vietnam in 2011, the city ranked no. 20/63 provinces.

However, Ho Chi Minh City economy is still facing many difficulties. The whole city has only 10% of industrial factories with high quality and modern technology, including 21/212 textile factories, 4/40 footwear factories, 6/68 chemical units, 14/44 food processing factories… owning advanced manufacturing technology and modern technique. The industry of city is towards the high fields bringing more economic efficiency. 

 

Trade

The total invested capital in 2013 was estimated at VND 227.033 billion compared to the same period of 4.7 %. The total invested capital construction of the city reached VND 197.684 billion, or 92.3% of the yearly plan, an increase of 4.6% over 2012. There were 440 FDI projects issued the investment certificates with the total registered capital of $ 963.1 million ($ 664.5 million of the charter capital). The average invested capital of a project reached $ 2.2 million.

Regarding the trade, the city has a diverse system of shopping centers, supermarkets and markets. Ben Thanh Market has long become the symbol of commercial exchange and played important role in the Ho Chi Minh City commercial development. In recent decades, many modern commercial centers appear in the city such as Saigon Trade Centre, Diamond Plaza… The city’s consumption is higher than other cities and 1.5 times higher than Hanoi capital.

 

Ho Chi Minh City - a place of commercial centers

 

The average consumer price index in 2013 increased 3.67% compared to the average price in 2012. Aslo, in 2013, the export turnover of goods reached $ 26.575,1 million, down 6% over the last year. The import turnover reached $ 25.879,6 million, up 14.9% compared to the last year. The total haulage was estimated at VND 54.854,4 billion, an increase of 15.6% over the last year. The cargo turnover reached VND 38.067,3 billion, accounting for 69.4% of the total haulage. The turnover from passenger transport reached VND 16.787,2 billion, accounting for 30.6% of the total haulage, up 13,.6% compared to the last year.    

The volume of goods through the port reached 73.072,2 thousand tons, up 9.2% over the last year, of which the exported goods were 28.011,1 thousand tons, making up 38.3%, the imported goods reached 32.556,6 thousand tons, accounting for 11.2%, and the domestic goods reached 12.417,4 thousand tons, up 5.5%.

The total net revenue for the state budget of Ho Chi Minh City in 2013 was estimated at VND 12.229,514 billion, reaching 100% of the estimate, up 8.2% over the same period. The total budget reached VND 59.684,5 billion, exceeding 37.6% of the estimate, up 3.4% compared to the same period. The total revenue expenditure was estimated at VND 46.574,2 billion, exceeding 7.4% of the plan and decreasing 22.5% over the same period.

The total deposits in the city reached VND 1.127,9 trillion, up 10.2% over the late 2012. As of November 30, 2013, the number of poor households of the city was about 18.542 with 81.709 inhabitants, accounting for 1.02% the total number of households, about 0.8% of poor households in the whole country. The city has attracted labors and created jobs for 293.2 thousand employees, exceeding 10.6% of the yearly plan and increasing 14.7% over 2012. The number of new jobs created in 2012 was 123 thousand, exceeding 2.5% the yearly plan and up 0.06% compared to the last year.

 

Agriculture – Forestry - Fishery

The production value of agriculture, forestry and fishery in 2013 reached VND 14.633,5 billion, up 5.7% compared to the last year. The agricultural production value reached VND 10.742,1 billion, increasing 4.6%, of which the cultivation increased by 5.4%, the livestock increased 4%. The planted area was estimated at 44.371ha, up 6.7% over the last year. The forestry production value was VND 132.1 billion, up 5.6%. The fishery output value was estimated at VND 3.759 billion, up 9.6%. In the whole 2013, the retail sales of goods and services reached VND 606.978,9 billion, an increase of 12.6% over the same period. 

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