According to the Vietnam Steel Association (VSA), crude steel production hit an estimated 14.8 million tonnes in the first half, a 21.2 per cent year-on-year jump, while steel consumption climbed 13.1 per cent to about 17.9 million tonnes, providing a sturdy base for growth.

HÀ NỘI — Vietnamese steelmakers are contending with a triple blow of mounting trade barriers, tougher green production mandates and persistent global market turbulence.

A manufacturing rebound, public investment-led domestic demand and a drive to sharpen competitiveness are nonetheless giving the industry space to sustain its growth trajectory.

Steel exports have been under pressure since the start of the year as chronic global overcapacity keeps fueling protectionism in key markets.

The US has slapped duties as high as 50 per cent on some steel products under the Trade Expansion Act’s Section 232, while Việt Nam remains a frequent target of trade remedy probes and tighter rules on origin, quality and technical standards.

As a result, Vietnamese mills are now grappling not just with market share erosion but mounting pressure to bolster compliance paperwork, tighten supply chain management and raise their ability to meet customer requirements. Simultaneously, greenhouse gas reduction mandates and the Carbon Border Adjustment Mechanism (CBAM) have become essential for entry into major export markets.

The squeeze is especially acute as steel is among the sectors covered by the European Union’s CBAM. Failing to overhaul production technology, clamp down on emissions and deliver transparent carbon reporting could strip the industry of its competitive edge in its traditional high-value export destinations.

The industry is also exposed to wild swings in imported raw materials such as iron ore and scrap steel. Continued volatility in input costs, freight and exchange rates, and geopolitical risks could materially dent production efficiency and earnings.

Deputy General Director of Vietnam Steel Corporation (VNSteel) Phạm Công Thảo said the 2026 outlook remains positive, propped up by steady domestic demand. VNSteel is targeting aggressive growth while maintaining its industry-leading role and contributing to the country’s double-digit economic expansion goal.

To do that, VNSteel is channeling investment into quality steel products to gradually displace imports, particularly those serving national defence-security and strategic industrial segments where domestic involvement is still thin.

It is also tightening corporate governance and wringing maximum value from internal resources under the Politburo’s Resolution 79-NQ/TW on State-owned economic sector development, while driving targeted investment to lift productivity, quality and business efficiency.

According to the Vietnam Steel Association (VSA), crude steel production hit an estimated 14.8 million tonnes in the first half, a 21.2 per cent year-on-year jump, while steel consumption climbed 13.1 per cent to about 17.9 million tonnes, providing a sturdy base for growth.

Exports, however, totalled just 1.79 million tonnes, down 4.8 per cent from a year earlier, underscoring uneven global demand, fluctuating steel prices and an ever-tightening web of trade restrictions.

Forging a green-fueled expansion

The VSA forecast that Việt Nam's crude steel output could reach 27 million tonnes in 2026, up 10 per cent year-on-year. Finished steel production is projected at 33 million tonnes, with domestic consumption of 28 million tonnes and exports of six million tonnes. Steel imports are expected to decline, signaling an improved domestic production capacity and the growing bite of market management and trade remedy measures.

VSA Chairman Nghiêm Xuân Đa said the industry must fortify the domestic market against cheap, low-quality imports and unfair competition. He called for tighter quality control rules for imported steel, including mandatory compliance with Vietnamese standards before products can reach the domestic market, to level the playing field.

Steelmakers must also fast-track their green transition and digital transformation, pouring capital into energy-efficient technology, resource optimisation and emissions cuts.

At the same time, they need rigorous adherence to rules of origin and greater transparency across raw material sourcing and supply chains to dodge anti-circumvention trade probes and burnish their reputation in export markets.

On the policy front, the State should beef up early warning systems and market forecasting while giving enterprises more firepower to fight trade remedy cases. It must keep upgrading technical standards and steel product regulations and roll out stable, long-term investment policies consistent with Việt Nam’s international commitments.

Speaking at a recent conference on supercharging exports to achieve double-digit growth, Minister of Industry and Trade Lê Mạnh Hùng said the ministry would continue reviewing regulations and consulting enterprises and industry associations to further slash red tape, cut costs and smooth the path for production and trade.

It will redouble efforts to squeeze maximum advantage from free trade agreements, fuel sustainable export growth and reinforce trade remedy early warning for firms.

At the same time, it will work hand-in-hand with ministries and agencies to unpick market obstacles, ignite industrial development, raise localisation rates and build more resilient, self-reliant domestic supply chains, thus sharpening the international competitiveness of Vietnamese goods, he added.​

Ms. Nguyen Thi Huong, Director General of the National Statistics Office at the Ministry of Finance, tells Vietnam Economic Times / VnEconomy about the drivers behind Vietnam’s robust first-half economic performance, the challenges that could weigh on growth in the second half, and the policy priorities needed to achieve the country’s ambitious 2026 GDP target.

The second-quarter and first-half 2026 GDP figures have just been released, revealing impressive growth. In your view, what were the key drivers behind Vietnam’s economic performance in the period?

Ms. Nguyen Thi Huong, Director General of the National Statistics Office.

Vietnam’s GDP growth in the second quarter and first half of 2026 stand out as major bright spots, reflecting both the economy’s strong recovery and its resilience. Building on the momentum from the first quarter, GDP expanded by 8.39 per cent year-on-year in the second quarter, up from 8.14 per cent in the same period of 2025. For the first half of the year, growth reached 8.18 per cent, compared with 7.63 per cent a year prior. This is an impressive achievement given the backdrop of sluggish global demand, rising trade protectionism, and persistent geopolitical uncertainty.

Growth was broad-based across all three major sectors of the economy. Agriculture, forestry, and fisheries expanded by 4.06 per cent in the second quarter and 3.87 per cent in the first half. Industry and construction recorded the strongest performance, growing by 10.51 per cent and 9.81 per cent, respectively, while services maintained solid momentum at 7.87 per cent and 8.09 per cent.

To understand what drove this performance, we need to look at both the supply and demand sides of the economy. From the supply side, growth reflected the combined strength of all three sectors.

Agriculture, forestry, and fisheries continued to serve as a key pillar of the economy. Structural reforms, technological advances, and improved management of cultivation area codes significantly boosted crop and aquaculture productivity, while effective disease control and the wider adoption of bio-secure farming practices supported steady growth in livestock and forestry.

Industry and construction remained the economy’s primary growth engine. Manufacturing continued to lead the way, expanding by 10.56 per cent in the second quarter and 10.23 per cent in the first half, contributing 2.85 and 2.73 percentage points, respectively, to overall GDP growth. The gains were driven by a strong recovery in export orders for key industries, including electronics, computers, optical products, metals, and motor vehicles.

The mining sector also recorded its fourth consecutive quarter of positive growth, expanding by 7.59 per cent in the second quarter, largely due to higher crude oil and natural gas output that helped secure domestic supplies of essential raw materials.

Construction accelerated sharply, posting growth of 12.28 per cent in the second quarter, while electricity and gas production and distribution rose 12.19 per cent, meeting rising energy demand from both households and industry.

Despite mounting input cost pressures, the services sector also maintained strong momentum, with several industries outperforming the sector average. Wholesale and retail trade, along with motor vehicle and motorcycle repair, grew by 9.62 per cent in the second quarter and 9.67 per cent in the first half. Transportation and warehousing expanded by 11.19 per cent and 10.18 per cent, respectively, while arts, entertainment, and recreation grew by 10.49 per cent and 10.11 per cent.

By contrast, accommodation and food services, which grew by just over 8.3 per cent, and banking and finance, at nearly 8 per cent, fell short of expectations. Public administration and defense contracted by 9.71 per cent in the second quarter, reflecting tighter control over recurrent State budget spending as resources were redirected toward priority growth initiatives.

With first-half GDP results now available, how much growth will Vietnam need in the second half of 2026 to meet the National Assembly’s full-year target? What are the biggest challenges the economy is likely to face?

The first-half results are certainly encouraging, but the road ahead will be far more challenging. Based on the latest growth scenario aligned with the government’s economic ambitions, achieving the National Assembly’s full-year GDP growth target of 10 per cent will require an exceptional performance in the second half of 2026.

With GDP growth of 7.94 per cent in the first quarter and 8.39 per cent in the second, bringing first-half growth to 8.18 per cent, the economy will need to expand by 11.16 per cent in the third quarter and 12.09 per cent in the fourth quarter to reach the annual target, or 11.7 per cent over the second half as a whole. Meeting such an ambitious target will require extraordinary macro-economic management as Vietnam navigates mounting domestic and external headwinds.

As one of the world’s most open economies, Vietnam is highly exposed to shifts in global markets. Rising trade protectionism, expanding technical barriers, and more frequent trade defense measures by major economies are placing increasing pressure on the country’s export-oriented manufacturing sector. Export growth is expected to moderate in the second half as demand in key markets such as the US and Europe remains fragile, export orders face the risk of softening, and prices for many of Vietnam’s major export products continue to decline amid intensifying global competition.

Public investment remains a critical catalyst for stimulating demand, but disbursement during the peak investment season in the second half continues to face significant obstacles. Delays in land clearance, lengthy project approval procedures, uneven implementation capacity across localities, and shortages of construction materials in several key economic regions all threaten to slow progress. Unless these bottlenecks are resolved, the multiplier effect of public investment on supporting industries - including construction, building materials, and transportation - will be significantly weakened.

The business sector, particularly small and medium-sized enterprises (SMEs), also continues to struggle after years of absorbing successive economic shocks. Many firms face persistent cash flow constraints and elevated logistics costs. Though lending and deposit rates have eased, credit demand remains weak, reflecting businesses’ continued caution toward expanding production amid uncertain market conditions.

Meanwhile, volatility in the US dollar, prolonged monetary tightening by major central banks, and rising global energy and commodity prices are increasing pressure on Vietnam’s exchange rate and imported inflation. At home, scheduled increases in State-administered prices for services such as healthcare, education, and energy later this year will further narrow policymakers’ room to maneuver. Striking the right balance between lowering interest rates to support growth and containing inflation while maintaining exchange rate stability is becoming increasingly difficult.

Though recent legal reforms have helped improve sentiment, the real estate market remains highly fragmented. Supply shortages persist in affordable commercial housing and social housing, while many major developers continue to grapple with debt restructuring and constrained access to new financing. These challenges are likely to weigh on the recovery of the construction sector and dozens of related industries.

Given these pressures and the ambitious growth target, what will be the key drivers of growth in the second half of the year? What strategic priorities should the government and businesses focus on to achieve the full-year target?

Though achieving 11.7 per cent growth in the second half of the year will be extremely challenging, I believe the full-year target remains attainable if Vietnam can fully leverage both its traditional and emerging growth drivers. In my view, the government and the business community should focus on four strategic priorities.

First, manufacturing will remain the cornerstone of economic growth. Vietnam should capitalize on robust FDI inflows, supported by its political stability and extensive network of next-generation free trade agreements (FTAs). Continued investment by major global corporations in high-tech manufacturing, electronics, semiconductors, and data centers will provide significant momentum for industrial expansion.

At the same time, the services sector, particularly high-value industries such as e-commerce, transportation, logistics, financial services, and international tourism, should be supported through year-end tourism promotional programs and investments in transport infrastructure to help lower business costs.

Second, accelerating public investment disbursement will be critical. The simultaneous launch of five new strategic metro lines in Hanoi, together with the continued development of interregional expressways and the Lao Cai - Hanoi - Hai Phong railway, will provide a strong boost to domestic demand. To maximize the impact, the government should further decentralize decision-making, expedite land clearance, and remove bottlenecks related to construction material supplies, allowing public investment to flow into the economy more quickly and crowd in private capital.

The second half of the year also coincides with the peak consumer spending season. Maintaining appropriate tax and fee reductions will help stimulate household consumption while supporting government revenues over the longer term. Expanding modern retail networks alongside e-commerce platforms will further strengthen domestic consumption.

Third, Vietnam should accelerate the adoption of the digital economy and AI. Greater use of big data, cloud computing, and automation will enable businesses to improve productivity and reduce costs amid rising input prices. While technology may not generate an immediate surge in growth, it will play a vital role in improving efficiency and supporting the economy’s long-term structural transformation.

At the same time, Vietnam’s commitment to achieving net-zero emissions is enhancing its appeal as a destination for renewable energy and green manufacturing projects. Realizing this potential will require a clearer regulatory framework for direct power purchase agreements (DPPAs) and continued investment in clean energy infrastructure, enabling domestic firms to integrate more deeply into global supply chains with increasingly stringent environmental requirements.

Fourth, institutional reform and improvements to the business environment remain the foundation of sustainable growth. Further streamlining administrative procedures and addressing legal bottlenecks in land, construction, and capital market regulations will strengthen investor confidence, unlock private capital, and ultimately improve Total Factor Productivity (TFP), laying the groundwork for stronger long-term economic growth.

Vietnam’s real estate developers accelerated bond issuance via private placement in June, raising more than VND60.66 trillion ($2.31 billion) in a single month, the highest monthly issuance value recorded by the sector so far this year.

According to market data, 15 property companies successfully completed 21 privately placed bond issuances during the month, with the majority of proceeds coming from several large developers and legal entities linked to major real estate groups.

The bonds carried a weighted average coupon rate of around 11.27% per year and an average maturity of 29.7 months, reflecting the relatively high cost of capital for real estate companies amid ongoing funding needs.

According to market data, 15 property companies successfully completed 21 privately placed bond issuances during the month, with the majority of proceeds coming from several large developers and legal entities linked to major real estate groups.

The bonds carried a weighted average coupon rate of around 11.27% per year and an average maturity of 29.7 months, reflecting the relatively high cost of capital for real estate companies amid ongoing funding needs.

Issuance activity was highly concentrated among a few major players. Leading the market was Vinhomes, which issued five bond tranches worth a combined VND22 trillion ($837.6 million), accounting for 36.3% of total issuance value.

Hung Phat Invest Hanoi Co., Ltd. ranked second, issuing two packages worth a total of VND9.3 trillion ($353.8 million), or 15.3%. Hung Long Real Estate Development JSC and ParkLand 53 Co., Ltd. each raised VND7 trillion ($266.3 million), representing 11.5% apiece.

Hung Phat Invest Hanoi, Hung Long Real Estate Development, and ParkLand 53 are legal entities associated with Masterise Group. Together, the three companies raised VND23.3 trillion ($887 million), accounting for 38.4% of the total bond issuance value by real estate companies in June.

Coupon rates also varied significantly among issuers. Hung Phat Invest Hanoi, Hung Long Real Estate Development, ParkLand 53, Starbay Hanoi Investment Co., Ltd., and Thang Long Co., Ltd. issued bonds with rates ranging from 10% to 10.6% per year, while Vinhomes and Vinpearl offered higher rates of 12% to 12.5% per year.

The difference may reflect the characteristics of each issuance as well as the financial structures behind the issuers. The relatively lower rates offered by Hung Phat Invest Hanoi, Hung Long Real Estate Development, and ParkLand 53 are believed to be linked to their relationships within the Masterise Group-Techcombank ecosystem, while Starbay Hanoi has connections with the MIK Group-VPBank network. Thang Long Co., Ltd., meanwhile, is a member of Eurowindow Holding.

The structure of bond transactions may also have influenced funding costs. Special purpose vehicles (SPVs) may benefit from collateral arrangements or guarantee mechanisms, helping reduce coupon rates. By contrast, the higher rates offered by Vinhomes and Vinpearl may better reflect the cost of securing medium- and long-term funding, as most of their bond maturities range from 24 to 60 months, longer than many other issuances in the market.

By maturity, bonds with terms of 13-36 months accounted for the largest portion of issuance, totaling VND26.91 trillion ($1.02 billion), or about 44% of total issuance value. Bonds with maturities of up to 12 months totaled VND19 trillion ($722.7 million), while those with terms of 37-48 months reached VND4.14 trillion ($157.7 million). Issuances with maturities exceeding 48 months amounted to more than VND10.6 trillion ($403.9 million).

The maturity structure indicates that property developers continue to favor medium-term fundraising strategies to support capital restructuring, manage cash flows, and meet financial obligations in the coming years.

The June bond market performance highlights that capital remains concentrated among a small number of major developers and groups of companies operating within interconnected business ecosystems. With prevailing coupon rates ranging from 10% to 12.5% per year, financing costs in the real estate sector remain elevated.

Meanwhile, the successful completion of multiple bond issuances within a short period indicates that developers are adopting more flexible approaches to restructuring funding sources and meeting financing requirements at different stages.