Tiếng ViệtThe world economy is on track for a stronger recovery after controlling the COVID-19 pandemic and overcoming its consequences. By the end of 2024, the world economy had achieved many good results in the context of many intertwined promoting and restraining factors. Overcoming challenges and making the most of opportunities for economic growth, the world economy in 2024 had many surprises, especially the recovery of the world’s largest economy. Entering 2025, international organizations have made many optimistic forecasts with many expectations that the global economy will maintain a strong growth rate.
World economic picture in 2024
Looking back at the world economic situation in 2024, there are some notable points as follows:
Firstly, most international organizations are optimistic and highly appreciate the growth recovery ability of the global economy.
According to the 2024 economic assessment reports of international organizations such as the International Monetary Fund (IMF) and the World Bank (WB), global economic growth in 2024 will reach about 3.5%. The actual growth rate of the global economy depends on the management of macroeconomic policies, especially the monetary policies of major central banks, China’s economic recovery and economic growth in emerging markets.
As the locomotive of the world economy, the US continues to maintain stable growth in 2024 despite facing pressure from inflation and high interest rate policies. The US economic growth in 2024 is maintained due to two main drivers: (1) Consumer spending of the American people; (2) Investment in infrastructure. Meanwhile, the European region is facing many challenges in energy and gas from the conflict between Russia and Ukraine. At the same time, the economic growth rate of this region is also affected by the economic restructuring of countries: Germany, France, Italy to cope with unpredictable impacts from within and neighboring European countries.
China still maintains its position as the second largest economy in the world in terms of GDP and has a significant influence on the overall growth rate of the world economy. However, with the internal instability of this economy, such as the real estate market and strict control policies on the development of new scientific and technological achievements of the 4.0 Industrial Revolution, the economic growth rate has not yet reflected China’s full potential (National Bureau of Statistics of China, 2024). Meanwhile, emerging markets: India, Brazil and Vietnam are emerging as new growth centers thanks to young labor and foreign investment.
Second, monetary policy operations are quite consistent among countries around the world.
In 2024, the world economy witnessed a rather special point in the response to inflation by central banks globally. Rising prices occurred in many countries and became a major common problem. Central banks, especially the US Federal Reserve (FED) and the European Central Bank, had to implement tight monetary policies to control prices. However, this policy has affected the acceleration of economic growth of the global economy.
Third, global trade and supply chains have recovered but are under pressure from trade protectionism.
After the COVID-19 pandemic passed, global trade activities have recovered and gradually stabilized. However, with many countries activating trade protectionism policies, especially the escalation of US-China trade tensions, the global supply chain has encountered many new pressures. In response, global economic corporations are seeking to diversify their sources of input materials and invest in technology development to optimize production processes.
Specifically, the US-China trade relationship continues to face many storms, as both countries apply protectionist measures to protect their domestic economies. This has reduced the efficiency of the global supply chain. This is one of the main reasons why many large multinational corporations are shifting their investments to regions other than China, such as Southeast Asia and South Asia, to minimize risks from disruptions in the supply chain. Vietnam, India, and Indonesia have become prominent investment destinations for these corporations.
In addition, many modern technologies such as artificial intelligence and blockchain have been promoted to improve the efficiency and transparency of the supply chain. The power of artificial intelligence and blockchain has beenenable global trading corporations to reduce delays in processing orders and improve their ability to meet customer demands in the face of unpredictable fluctuations in the world economy.
Fourth, countries and businesses invest heavily in mitigating the impacts of climate change and gradually shifting to a green economy.
In 2024, mitigating the impacts of climate change continues to be a policy priority for many countries around the world. Investing heavily in renewable energy and green technology has become a trend for many countries and businesses. Globally, sustainable development and carbon emission reduction policies have become policy priorities for many governments and businesses.
It can be affirmed that climate change is not only a challenge to global economic growth but also opens up new opportunities for further development of the world economy.
World economic outlook in 2025
In 2025, many forecasts recently published by world economic organizations show more optimism than the forecast for 2024. The forecasts all show confidence in a year when the global economy will maintain strong growth (Figure 2) when central banks begin to cut interest rates and global economies have become stronger. Factors influencing more optimistic expectations for 2025 include:
First, central banks maintained loose monetary policies in the final months of the year and are expected to continue until the end of the second quarter of 2025. If inflation is well controlled, central banks will ease monetary policies, which will help boost investment and consumption, creating momentum for economic growth.
Second, technology continues to be a key driver of global economic growth. Areas such as artificial intelligence (AI), blockchain, and the Internet of Things (IoT) are expected to create new opportunities for businesses and workers.
Third, in the context of global challenges such as climate change and economic inequality, international cooperation will play an important role. Organizations such as the United Nations, IMF, and G20 will continue to act as intermediaries to promote global solutions.
Fourth, many countries are focusing on infrastructure investment and education to prepare future generations as core factors to ensure sustainable development and increase the ability to catch up with developed countries in the world.
Fifth, renewable energy is expected to account for a larger proportion of the global energy mix. Countries will invest heavily in emission reduction technology and create green jobs, contributing to the goal of sustainable development.
In addition to positive factors, the world economy also faces many different challenges: Specifically: (i) conflicts and political instability can disrupt economic growth cycles and supply chains at the regional and global levels; (ii) many countries will have to adjust fiscal policies when debt repayment pressure for loans in the fight against the COVID-19 pandemic comes due; (iii) Natural disasters and extreme climate continue to pose risks of major losses to the world economy.
Assessment of the impact on Vietnam’s economy
Vietnam’s economy in 2024 has taken advantage of the opportunities brought by the world economy and achieved good growth targets. Building on the development momentum of 2024, in 2025 Vietnam will continue to strive to achieve a high growth target. Therefore, the opportunities and challenges brought by the world economy in 2025 will be handled in the direction of making the most of the opportunities and seeking advantages in the challenges to not only overcome the challenges but also create added value when identifying the advantages. The expected impacts of the world economy on Vietnam’s economic growth and development include:
First, as one of the bright spots in Southeast Asia, Vietnam continues to attract foreign investment thanks to its political stability, abundant labor force and free trade agreements. The shift in global supply chains is bringing great advantages to Vietnam, especially in manufacturing and high-tech industries.
Second, in the context of global trade recovery, Vietnam’s key export items such as electronics, textiles and agricultural products continue to grow. However, pressure from trade protection measures and weak demand in major markets such as the US and the European Union (EU) may slow down export growth.
Third,Global inflation and exchange rate fluctuations could impact the cost of importing raw materials and the competitiveness of Vietnamese goods. The State Bank of Vietnam needs to continue to maintain a flexible monetary policy to stabilize the market.
Fourth, Vietnam has committed to achieving net zero emissions by 2050. This creates great opportunities for renewable energy and green investment. However, this transition requires large financial and technological resources.
Conclusion
The year 2024 is full of challenges but also holds many opportunities for the world economy. The year 2025 brings hope for recovery and sustainable development, especially when countries and businesses cooperate to face global issues. It is important that economic policies are flexible, focused on innovation, and put people and the environment at the center of development. In particular, Vietnam has the potential to continue to maintain a high growth rate in the global context, but needs to focus on innovation, improve the quality of human resources and strengthen international cooperation to effectively respond to future challenges.
