Vietnam’s FDI Landscape in 2025: Bright Spots and Transformations
As we delve into Vietnam’s Foreign Direct Investment (FDI) narrative, the numbers speak volumes about a nation on the rise. In the first ten months of 2025, registered FDI soared to $31.52 billion, marking a 15.6% increase year-on-year. Additionally, realized capital climbed to $23.6 billion by November, showcasing an 8.9% rise, the fastest growth in disbursement seen in five years. Such figures are not just statistical milestones; they reflect a robust transformation in Vietnam’s investment landscape.
Nguyen Tuan Khoi, a foreign investment consultant at Dezan Shira & Associates, highlights a critical development: the narrowing gap between investment commitments and actual capital deployment. This reflects an increasingly capable system where licenses are converted to operational projects more efficiently. The implementation of the Land Law in 2025 has significantly alleviated clearance and valuation issues, propelling investors from approval straight to construction at unprecedented speeds.
Shifting Nature of FDI: From Aspirational to Productive
The evolution of FDI in Vietnam is marked by a significant shift from merely aspirational capital to productive investment. This transformation is particularly noteworthy in the manufacturing sector, where 82.9% of realized FDI in 2025 was allocated. However, unlike previous years dominated by labor-intensive industries, Vietnam is now attracting investments in electronics, semiconductors, and high-precision engineering. Major players like Amkor, Hana Micron, BESI, and Foxconn are spearheading this change, establishing a foundational ecosystem that includes equipment suppliers, materials vendors, and specialized service providers.
This shift toward high-tech manufacturing signals not just investment but also the emergence of local technological capabilities. Companies like FPT Semiconductor and Viettel High Tech are crafting locally designed products like power management chips and 5G chipsets. Such developments indicate that Vietnam is moving beyond being merely an assembly hub; it is beginning to internalize intellectual property and technological know-how.
Policy Innovations: Creating a Favorable Investment Climate
Another bright spot in Vietnam’s FDI journey in 2025 is the introduction of innovative policies aimed at enhancing the investment climate. The operation of Direct Power Purchase Agreements (DPPAs) represents a monumental shift that broke the monopoly on electricity procurement. This initiative caters to global corporations focusing on renewable energy and has stimulated a wave of green FDI previously stunted by regulatory constraints. Noteworthy is the Lego manufacturing agreement, which established the company’s first carbon-neutral factory powered entirely by renewable energy.
In addition, the establishment of the Investment Support Fund transformed the implications of the global minimum tax into a strategic advantage. The fund channels tax revenues into cash grants for R&D, training, and infrastructure, shifting the paradigm from passive incentives to active operational support—aligning investor benefits with national goals for technological advancement.
Infrastructure Development: Boosting Connectivity and Opportunities
Infrastructure development has also played a pivotal role in making Vietnam an increasingly attractive investment destination. The completion of the Eastern North–South Expressway and the launch of Phase 1 of the Long Thanh International Airport in late 2025 have fundamentally changed the logistics landscape. These infrastructure advancements improve travel times between economic hubs and expand air cargo capacity, particularly essential for high-value goods such as electronics and semiconductors.
This surge in connectivity has opened credible investment opportunities in Tier 2 provinces like Nghe An, Thanh Hoa, and Quang Ngai, where land and labor costs remain competitive. Furthermore, the introduction of standard-gauge rail links connecting northern Vietnam with China’s Yunnan province has fortified Vietnam’s role in regional supply chains, facilitating smoother operations for companies implementing China+1 strategies.
Institutional Innovations: Building a Strategic Financial Hub
The establishment of Vietnam’s international financial centre (IFC) in Ho Chi Minh City and Danang reflects an ambition to retain higher value-added segments of global commerce. The National Assembly’s approval of the Law on Specialised Courts for the IFC sets a statutory foundation for international arbitration and dispute resolution within recognized frameworks. Coupled with generous fiscal incentives and regulatory sandboxes, this institutional innovation is designed to attract financial institutions and tech-driven service providers.
While potential execution risks remain—especially at the local level—the IFC framework broadens the FDI spectrum beyond traditional manufacturing to encompass capital-intensive and knowledge-based sectors, thus diversifying Vietnam’s economic base.
A Bright Outlook for 2026 and Beyond
Entering 2026, these multifaceted developments portend a promising future for Vietnam’s FDI landscape. The government’s ambitious GDP growth target of 10% or higher underscores a commitment to deploying fiscal stimulus and stimulating public investment, especially in transport and urban infrastructure.
For potential investors, the clear and consistent policy direction prioritizing high technology, green energy, and innovation-intensive activities is particularly encouraging. Those who act promptly to secure renewable energy and cultivate local talent are likely to enjoy distinct advantages.
As we look ahead, Vietnam’s FDI narrative is defined less by cost arbitrage and more by capability building. The confluence of effective policy execution, upgraded infrastructure, and a burgeoning semiconductor ecosystem has transformed Vietnam into not just an alternative manufacturing base but a platform for scalable, high-quality growth embedded in both regional and global value chains.