Vietnam has transformed itself at a rapid clip from one of the poorest countries in the world in the late 1980s to a lower middle-income country. More recently, it has been the most obvious beneficiaries of supply chain diversification out of China, attracting investment from the likes of Samsung, Intel and Apple suppliers. These eminently marketable investments can give a illusory picture of the actual strength of local industry. Vietnam largely remains a site for final assembly, with limited local linkages into the operations of major manufacturers. Tô Lâm, who took over Vietnam’s top job of General Secretary in August 2024, has been unusually candid on the depths of the country’s challenges. Speaking earlier this year, he warned that Vietnam was “stuck at the lowest end of the value chain” and risked failure without major structural reforms.
National champions – Vietnam’s solution to the middle-income trap | Lowy Institute
