Vietnam’s business sentiment in construction positive in 2024

Accordingly, 52.5% of the surveyed expect positive changes, 36.9% forecast the sector will remain unchanged as compared to 2023, while 10.5% believe the market could grow gloomier this year.

Although the construction market may not carve out robust results in 2024, enterprises expressed their hope that 2024 could be “the first brick” that lays foundation for a recovery and new development circle.

Vietnam Report General Director Vu Dang Vinh said that enterprises expect their business will be backed by stable macroeconomy, ensured major balances, and brighter realty market with legal bottlenecks to be removed and better market confidence.

The State Bank of Vietnam has set a credit growth target of 15% this year, creating favourable conditions for credit institutions to provide sufficient capital for the market in a timely fashion, Vinh stressed, adding interest rates have cooled down, easing burden for construction firms.

Vinh described public investment as a pillar and locomotive for the Vietnamese economy at the moment and in both mid- and long-terms, saying investment in transport infrastructure development has been accelerated, and disbursement of public capital will be at its peak this year for key transport projects.

Some 677.3 trillion VND (29.29 billion USD) is set aside for public investment this year, and 95% of which must be disbursed under a Prime Minister’s decision. Of the total amount, up to 422 trillion VND is for transport infrastructure construction, which is expected to prop up the construction sector.

According to Vinh, the domestic construction market is expected to benefit from the FDI wave, with 36.6 billion USD funneled into the country in 2023, a year-on-year surge of 32.1% despite global economic uncertainties. Around 23.18 billion USD was disbursed in the year, up 3.5% year-on-year, and marking a record high thus far.

He said the strong foreign capital inflow has created a more exciting prospect for 2024 as Vietnam’s geopolitical and production position have been consolidated.

During January – February this year, 2.8 billion USD in foreign capital was disbursed, the highest figure recorded for the same time in the past five years, opening up numerous opportunities for the industrial construction sector.

Besides, enterprises’ positive sentiment also comes from their intrinsic strength with effective financial management capacity, successful application of digital transformation into management and operation, high-quality human resources, and improved prestige and brands, he added.