Hanoi (VNA) – Amid mounting geopolitical uncertainty, particularly armed conflicts in the Middle East, Vietnam’s economy showed notable resilience in the first quarter of 2026.
The country’s Index of Industrial Production (IIP) rose 9% year-on-year. Behind this encouraging figure, however, there remained significant challenges as rising logistics costs and energy prices continued to exert pressure across the economy, affecting industrial production, food security, and infrastructure development.
Agriculture remains pillar of stability
Against the backdrop of external headwinds, the agriculture-forestry-fishery sector once again affirmed its role as a stabilising force, helping to safeguard macroeconomic stability.
According to the National Statistics Office (NSO), the sector’s added value increased 3.58% in the first quarter, contributing 0.44 percentage points to the country’s overall economic growth. The result reflected effective restructuring in crop and livestock production and the sector’s high degree of self-sufficiency.
Dau Ngoc Hung, Head of the NSO’s Agriculture, Forestry and Fisheries Statistics Division, said that amid supply chain disruptions caused by conflicts in the Middle East, essential production sectors such as agriculture, forestry, and fisheries served as a buffer against major economic shocks.
He noted that agriculture not only ensured domestic food supplies but also helped contain inflationary pressures when global commodity prices fluctuated sharply.
Agricultural production maintained positive growth, especially among perennial crops. Durian output rose by 15%, jackfruit 12.8%, and pepper 5.3%. Agricultural export turnover was estimated at 12 billion USD in the first quarter, up 4.2% year-on-year. Strong demand came from major markets, including China, Japan, and ASEAN member states.
However, the sector remains vulnerable to rising oil prices, which have increased transport and logistics costs. Fisheries output grew 1.6% in the first two months of the year but fell 2.7% in March as higher fuel costs forced many fishing vessels to reduce operations. Rising prices of fertilisers and animal feed have also squeezed farmers’ profits.
Contrasting trends in construction and industry
While agriculture provided stability, industry remained the primary engine of growth in the first quarter. The 9% increase in the IIP reflected a recovery in export orders, with electronics, electrical equipment, textiles, and footwear maintaining stable production levels, supported by contributions from both foreign-invested and domestic enterprises.
Notably, electricity consumption in the industrial and construction sectors rose 8.3%, indicating strong manufacturing activity.
However, Phi Thi Huong Nga, Head of the NSO’s Industry and Construction Statistics Division, noted signs of slowing momentum. The Purchasing Managers’ Index (PMI) hovered around the 50-point mark, suggesting manufacturing expansion was moderating.
According to Nga, the impact of logistics disruptions has so far been mitigated by accumulated orders and businesses’ adaptability. However, continued increases in input costs could place the manufacturing sector under greater strain.
Meanwhile, the construction sector has struggled to meet expectations despite efforts to accelerate public investment. An NSO survey found that 44.4% of construction firms faced more difficult conditions in the first quarter than in the previous quarter.
Nga attributed the situation largely to soaring material prices, with 70.1% of surveyed firms citing higher costs for steel, cement, sand, and stone as a major challenge. A sluggish residential property market, payment delays, and cash-flow constraints have further weighed on the sector.
Looking ahead, Nga stressed the need to stabilise material prices, improve cash flows, accelerate the disbursement of public investment, and remove administrative and land-clearance bottlenecks.
Other experts also highlighted the importance of diversifying export markets and preparing response scenarios for geopolitical risks to sustain growth momentum and support Vietnam’s goal of achieving double-digit economic growth./.
