HCMC’s competitive edge declines: experts

Vu Thanh Tu Anh, Dean of the Fulbright School of Public Policy and Management, on Saturday pointed to a decline in HCMC’s share of national GDP and export turnover as clear indicators of this trend.

Five years ago, the southeastern region of Vietnam, including HCMC, contributed 50% of the country’s total export. But that figure has dropped to one-third, while the Red River Delta region now accounts for 53% of the nation’s exports, Anh noted at a conference where experts gave advice on HCMC’s development for the 2026-2030 period.

This shift, he said, underscores the erosion of HCMC’s standing and competitiveness relative to other regions.

The city’s industrial sector, traditionally a cornerstone of its economy, is also faltering. Industrial production now makes up just 54% of HCMC’s Gross Regional Domestic Product (GRDP). While services and commerce remain vital, they are not robust enough to propel the city into a new phase of development, where growth rates would hover between 9-9.5%, according to Anh.

Comparisons with regional metropolises like Kuala Lumpur and Bangkok further illustrate HCMC’s struggles.

“HCMC’s capabilities and competitiveness are in decline. The city’s growth model does not have much drive behind it, meaning it has reached its limit of development,” Anh said.

Tran Hoang Ngan, assistant to the HCMC Party Committee Secretary, added that the city ranks lower than Jakarta and Bangkok on smart city index. He also pointed out a decline in social investment over the past three years.

While investments are crucial, contributing up to 40% of the city’s growth, investments have been falling over the last three years, and the city’s growth did not reached the same levels in previous years, Ngan said.

Ngan proposed that HCMC aims to invest VND170 trillion (US$6.8 billion) in public infrastructure by the end of 2025 to stimulate social investments and lay the groundwork for future growth.

Tran Du Lich, a member of the national monetary and financial policy advisory council, said HCMC has not achieved a breakthrough in economic restructuring. The industrial sector has not seen marked improvements in productivity, Lich said, noting that the city continues to grapple with long-standing project issues, which drain resources.

Lich advocated for a target growth rate of 7.8% this year and 8.5% next year. He also called for increased public and private investments by 2030 to ensure social investments reach 35% of GRDP. Enhancing productivity by 7-8% annually, as well as digital and industrial transformation, are also needed to achieve a breakthrough, he added.

Phan Van Mai, chairman of the HCMC People’s Committee, said that for the city to attain an 8.5-9% growth rate by 2030, HCMC would require VND4.4 quadrillion in social investments during the 2026-2030 period, or approximately VND800-900 trillion annually.

While saying the targets are achievable, Mai stressed the need for effective policies and mechanisms to realize them. Mai also said he had instructed the Department of Planning and Investment, as well as relevant departments, to look into the matter and propose practical solutions.