Infrastructure development to support FDI in Vietnam
Vietnam has been an attractive destination for international businesses over the past 30 years thanks to rapid economic reforms, abundant resources and a large population. According to the World Bank, Vietnam is one of the fastest growing economies globally, with an average GDP growth of 6.31% in the period 2020-2030. However, Vietnam has entered a new era of globalization, requiring a different approach of key industrial parks attracting FDI
to maintain its international business appeal.
International investors will consider new factors when choosing to invest, including the level of digitization of a destination, Infrastructure development to support FDI rather than traditional factors such as low-cost labor, abundant resources or large population size.
1. SMART CITIES ATTRACTIVE TO INVESTORS
While previous models of globalization mainly revolved around the trade of labor-intensive tangible goods between countries, globalization in the new phase revolves around the provision of integrated and intangible digital services to businesses and individuals. According to experts from RMIT University, this trend can be called “digital globalization” or “digital globalization”.
Currently, Ho Chi Minh City, Hanoi, Da Nang, Nha Trang and Binh Duong are implementing administrative reforms to launch and accelerate smart city projects to attract more foreign investors. Specifically, new business models are based on the application of information technology and instant information sharing. These information flows will help organizations and individuals establish new commercial, financial and social connections at local, regional, national and international scales. And all these connections can help trading partners expand their trade volumes.
Infrastructure development to support FDI in Vietnam 2025
As competition between countries and cities around the world increases day by day, every region must work harder to attract investors, especially when global organizations now have more options. According to S4B Vietnam, international investors will consider new factors when choosing to invest, including the level of digitalization of the destination, the level of economic sustainability and the social nature of the surrounding environment.
These factors will influence investment decisions more than traditional factors such as low-cost labor, abundant resources or large population size. Vietnam should accelerate investments in sustainable smart city initiatives and foreign investment to maintain the high growth rate of the past 30 years, become a magnet for foreign investment, and above all, bring high quality of life to its people.
2. ELEMENTS FOR SMART CITIES
According to the Technical Director and Senior Advisor of international engineering consultancy Aurecon Vietnam, a strong digital infrastructure is especially important for the operation of smart cities. Therefore, Vietnam must focus on solutions such as wireless networks, smart water and energy management, wastewater recycling, smart traffic systems, automated parking management and similar solutions.
“In the implementation process, Vietnamese cities should follow international standards and frameworks on smart city initiatives and foreign investment,” Mr. Tuyen emphasized.
Sustainable smart cities will also have to rely more on digital and electric power. Mr. Dong Mai Lam, General Director of Schneider Electric Vietnam and Cambodia, said that the technology that we need to accelerate three times faster than the current rate in three main directions: Electrification – because this is the only way to decarbonize; Decarbonization of power generation and Improving efficiency. These three directions of action have the potential to reduce emissions to transform the energy system…
“Both business and individual customers are becoming more aware of the aspects of sustainability, moving towards carbon neutrality and net zero emissions. Therefore, we must apply breakthrough technology to make products and systems more sustainable and of higher quality,” Mr. Lam added.
Currently, Ho Chi Minh City, Hanoi, Da Nang, Nha Trang and Binh Duong are implementing administrative reforms to launch and accelerate smart city projects to attract more foreign investors. Accordingly, sustainable smart cities need to be places that enable the transfer of data, technology, logistics and transport infrastructure growth, ideas and best practices, while providing sustainable and livable environments.
Vietnam smart city initiatives and foreign investment
Vietnam’s socio-economic situation is stable and it is known as one of the most dynamic economies. With a strategic location, located in the center of the East Asia region – where many large and vibrant economies are concentrated, Vietnam has a favorable geographical location for trade with the world, being both a regional connection center and a gateway to penetrate economies in the western region of the Indochina Peninsula.
In the context of the restructuring of the global supply chain, FDI attraction to Vietnam is still increasing in terms of new investment capital and adjusted capital. If you are foreign investors who continue to consider Vietnam an important investment destination in the medium and long term, please do not hesitate to reach out to us.
We are a trusted partner for foreign investors looking to establish and expand their presence in Vietnam. Whether you need assistance with company registration, labor compliance, or operational support, we are here to guide you every step of the way!
>>>Read more: Foreign investment incentives in Vietnam 2025
S4B Vietnam
- Address: Unit 701B – 701C, Tower A, Handi Resco 521 Kim Ma Street, Ba Dinh District, Hanoi, Vietnam.
- Tel: + 84 24 3974 4181
- Email: service@s4b.com.vn
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