Why Vietnam and the Philippines are growing so fast, explained
Compared to its neighbors, Vietnam is doing very well. Let’s look at all of Vietnam’s neighbors except for China. They are Laos, Cambodia, and Thailand. So what allowed Vietnam to thrive?
Vietnam has a higher GDP growth rate than Laos, Cambodia, and Thailand. Its population which is important for doing business internationally is at 95 million, also higher than Laos, Cambodia, and Thailand.
Vietnam ranked 70th best in the world for ease of doing business, compared to 154 for Laos, 132 for Cambodia, and an unsurprising 21 for Thailand. Now, let’s apply these same metrics to the Philippines.
Let’s consider the Philippines’ main neighbors to be Taiwan, Malaysia, and Indonesia. We’re not gonna get into what Taiwan’s status is, as of now, but regardless if you consider it to be a territory of China or an independent country, we’ll still compare it to the Philippines which is a sovereign state.
The Philippines has a higher GDP growth rate than Taiwan, Malaysia, and Indonesia. The population of the Philippines is at 106 million, higher than Taiwan and Malaysia, but lower than Indonesia.
The Philippines ranked 95th best in the world for doing business, much lower than Taiwan, Malaysia, and Indonesia, but drastically improving.
Now, let’s get into the reasons why these two countries are growing so fast. These countries are very different. They come from opposite sides of the Cold War but yet many things bind them.
Both have a similar population and are crucially located in the South China Sea. An incredibly important waterway. Both are major tourist destinations. Both are located near other important business centers including Kuala Lumpur, Singapore, Bangkok, and Hong Kong.
Both have friendly relations with numerous countries, not just one or two. And in the case of Vietnam, the country is located near landlocked countries or countries with limited sea access which makes it convenient to ship goods through Vietnam.
All these factors allow these two East Asian partners to thrive.