The South Korean chaebols are constantly referenced as a model to be emulated in Vietnam. However, whereas at first glance South Korea’s economic development on the back of its chaebols looks to be a success story, that doesn’t really tell the whole story. With this in mind, this article looks at how the chaebols system worked and didn’t work and whether this is a model Vietnam should be looking to follow… Read More »

Banking and finance News

State Bank continues open market operations

The State Bank of Vietnam has continued to carry out open market operations. Specifically, there were US$5.01 billion worth of reverse repos outstanding as of the close of business March 20. There were, however, no outstanding treasury bills.

Of note, the dong has continued to depreciate this week. Whereas this time last week it was down by 1.71 percent over the start of the year, as of close of business March 20 it was down by 1.91 percent.

This is, of course, not necessarily a bad thing with a weaker dong supporting smaller enterprises to sell more goods both locally and to overseas buyers.

Economy news

Vietnam General Secretary puts private enterprise front and centre in economic vision

General Secretary of the Communist Party of Vietnam, To Lam, has penned a statement published in Vietnam’s official Government of Vietnam newspaper in which he outlines a private sector-led development trajectory for Vietnam moving forward.

This is important in that the General Secretary is generally seen as the most powerful position in Vietnam’s political system and therefore the views expressed are very likely to inform government policy moving forward.

That said, the statement is very wide-ranging and lacks specific details. There is, however, a clear narrative around growing the private sector with the leader arguing many state-owned enterprises with access to resources and capital have failed to use them effectively. More or less, he seems to be suggesting that whereas in the past the government has focused on supporting state-owned enterprises, that focus is set to shift to the private sector.

What all of this means on a practical level, if anything, is hard to say. Privatising Vietnam’s state-owned enterprises is not a new concept; it has been around for decades but has just been a very slow process which seems to stem from complicated networks of vested interests in said enterprises.

That is to say, the emphasis should be not on what is being said but on who is saying it and if the relatively new General Secretary can push this agenda forward.

Car news

Vietnam’s automotive market to grow 4.1 percent a year through 2030: PWC report

Vietnam’s automotive industry is expected to see steady growth, with vehicle sales projected to increase at a 4.1 percent annual rate through 2030. Strong economic expansion, rising consumer demand, and government incentives are driving growth, though infrastructure gaps and financial constraints remain challenges, according to PWC’s ASEAN-6 Automotive Market Snapshot (Feb 2025).

The report also notes that:

Vehicle sales are projected to reach 572,000 units by 2030, up from 450,000 in 2024.
Vietnam’s 30 percent EV adoption by 2030 target is supported by tax cuts and incentives, but a lack of charging infrastructure remains a barrier.
Geopolitical risks, financial constraints, and stricter traffic regulations could impact long-term growth.

Education news

ADB invests US$150 million in Vietnam’s private education sector

The Asian Development Bank (ADB) has announced its first private sector investment in Vietnam’s education sector, leading a US$150 million sustainability-linked loan to Vinschool. The loan will reportedly support new facilities for 20,400 students in Hanoi, Ho Chi Minh City, and Hung Yen, The Asset is reporting.

The financing package includes:

US$40 million from ADB’s ordinary capital resources.
US$35 million from the Leading Asia’s Private Sector Infrastructure Fund 2 (LEAP 2).
US$75 million in parallel loans from ILX (US$40 million) and the Emerging Africa & Asia Infrastructure Fund (US$35 million).

As Vietnam transitions to a middle-income country, education quality and accessibility remain critical. The ADB’s first private education investment signals growing recognition of the private sector’s role in addressing these challenges. Additionally, the sustainability-linked component of the loan sets a precedent for future education financing in Vietnam and other emerging markets.

Food and Beverage news

Vietnam’s F&B industry grows 16.6 percent in 2024: Report

Vietnam’s food and beverage (F&B) industry revenue reached VND 688.8 trillion or US$27.55 billion in 2024, marking a 16.6 percent increase from 2023. However, growth was uneven throughout the year, with a noticeable difference between the first and last six months, according to the iPOS F&B Industry Report 2024.

Key points in the report include:

F&B chains increased their market share, growing from 5.2 percent in 2023 to 7.3 percent in 2024.
Revenue from independent F&B businesses remains dominant at 92.7 percent of the total, but chain restaurants saw a 21.5 percent revenue increase.
Beverage store revenue reached US$4.73 billion in 2024, up 13 percent year-on-year.
GrabFood and ShopeeFood dominate Vietnam’s online food delivery market, holding 50.6 percent and 47.7 percent of revenue share, respectively, while smaller players like BeFood, GoFood, and others collectively account for less than 6 percent.

Of note, Vietnam’s food and beverage sector has proven resilient in the face of economic uncertainty which speaks to the strong relationship between Vietnamese people and their food. That said, there is clearly a change taking place with traditional, small, independent food outlets losing market share to bigger franchise operations. That said, the market overall still has plenty of room to grow so any downsides to this market-recomposition seem negligible.

Labour news

Vietnam’s industrial parks struggle to fill jobs despite record hiring: survey

A survey by Vieclam24h has revealed that labour shortages persist in Vietnam, particularly in the textile and electronics assembly industries, as demand continues to outpace supply, Tuoi Tre is reporting.

The publication notes that major electronics manufacturers, including Luxshare-ICT, Foxconn, and Newwing Interconnect Technology, plan to hire over 90,000 workers in 2025, offering attractive salaries and incentives, putting further pressure on recruiters.

Labour shortages are an ongoing concern for Vietnam. Whereas low-cost labour has been a key selling point for the country, rising prices in manufacturing hubs like Ho Chi Minh City are making the wages on offer less attractive and making it more difficult for migrant workers to eke out a living, many of which are choosing to stay in their hometowns instead.

Tuoi Tre notes that beyond higher wages, businesses are prioritising career growth, workplace conditions, mental health support, and flexible working policies to retain employees.

Market entry news

China’s Global Times on defensive over Vietnam 9 dash line milk tea outrage

China’s Global Times has published an English-language editorial responding to outrage in Vietnam over a map on the website of milk tea outlet Changee that includes China’s nine-dash-line. The editorial seems to suggest Vietnam is being overly sensitive but also asserts China’s ownership claims over most of the South China Sea.

A few points of note:

This speaks to the importance of being aware of cultural sensitivities when entering a new market;
Elucidates the sometimes testy relationship between China and Vietnam; and
Suggests that China may be willing to prioritise its territorial interests over its economic interests.

Media news

Vietnam news coverage diversity dealt blow with cuts to VOA, RFA

Funding is to be cut to Radio Free Asia and Voice of America as the result of an executive order issued by the President of the US, Donald Trump. This could see their coverage of Vietnam come to an end.

Both RFA and VOA have provided extensive coverage of Vietnam, in particular political coverage and analysis, providing diversity in an otherwise very homogenous news media environment.

Notably, both sites are blocked in Vietnam, however, this is done at the domain level which makes it relatively easy to get around with a simple browser plugin.

Interestingly, this comes at the same time as Vietnam is reducing the size of its internal media industry as part of broader plans to shrink the size of the government. That is to say, the local media industry is being hit from two sides which is not great for local media practitioners.

Stock market news

Foreign traders net-sell US$128 million of HoSE stocks

Over the last five trading sessions to the close of business on March 20, foreign investors net-sold US$127.97 million worth of HCMC Stock Exchange stocks. This brings the total net-sold since the start of the year to US$845.2 million or US$4.4 billion since January 1, 2024.

Foreign trader activity, last five trading days

	Buy		Sell		Change
Date	VND	US$	VND	US$	VND	US$
14/3	2,735	$107.00	2,964	$115.96	-229	-$8.96
17/3	1,945	$76.10	1,739	$68.04	206	$8.06
18/3	1,866	$73.00	2,300	$89.98	-434	-$16.98
19/3	2,330	$91.16	3,735	$146.13	-1,405	-$54.97
20/3	1,906	$74.57	3,315	$129.70	-1,409	-$55.13
Total	10,782	$421.83	14,053	$549.81	-3,271	-$127.97

VND = billions; US$ = millions; source: Vietnam Stock Market Tracker

Tax news

Vietnam industry groups continue push for delay to tax increase on booze, sugary drinks

The Vietnam Chamber of Commerce and Industry (VCCI), a leading industry group in Vietnam, has held another in a series of conferences on proposed amendments to Vietnam’s Special Consumption Tax, VN Express has reported. The proposed amendment would see tax rates on beer and alcohol rise from 65 percent to 100 percent over five years and a 10 percent tax on sugary soft drinks.

Key claims/points made in VNexpress’ article include:

Consumers are reducing spending on beverages due to economic concerns, particularly job losses in public administration, technology, banking, and manufacturing.
A Nielsen survey shows beer drinkers may reduce consumption or shift to drinking at home, while rural consumers are turning to lower-cost, informal alcohol options.
Heineken Vietnam and Sabeco have proposed delaying the tax increase until 2028 and capping annual hikes at 5 percent to mitigate negative market effects.

Of course, a sharp tax increase could adversely impact the beverage industry, as businesses adjust pricing and consumers respond with changes to their drinking habits. The shift towards informal alcohol could also pose health and safety risks. That said, whereas this might pose a challenge for soft drink markers and beer brewers, a shift in consumer drinking habits could present opportunities for healthier beverage makers.

Trump news

Trump Organization CEO meets with Vietnam PM

Prime Minister of Vietnam Pham Minh Chinh has met with Charles Bowman, General Director of Projects for the Trump Organization in Vietnam, to discuss a proposed US$1.5 billion luxury urban, eco-tourism, and golf complex in Hung Yen province. The project is a joint venture between Hung Yen Investment and Development Group and IDG Capital, the latter representing the Trump Organization, Tuoi Tre is reporting.

Key points:

The US$1.5 billion project aims to develop a high-end urban, tourism, and sports complex, featuring a world-class golf course.
The project is targeted for completion by March 2027, in time for the APEC 2027 summit.
Bowman highlighted ongoing discussions with Vietnamese authorities and efforts to enhance US-Vietnam relations, including encouraging high-level business visits and advocating for Vietnam’s recognition as a market economy in the US.

Notably, Donald Trump’s return to the US presidency and his push for tariffs on countries with trade surpluses with the US has raised questions about how his administration will approach trade with Vietnam. In this context, the project’s approval may also have broader diplomatic and economic implications for Vietnam’s position in US trade relations.

Tourism news

Direct flights from Hanoi to Moscow resume

From May 8, Vietnam Airlines will resume direct flights from Hanoi to Moscow. Vietnam Airlines flights between the two cities were suspended in March of 2022 after the outbreak of the Ukraine War.

Flights were first suspended due to a need to “review and clarify procedures, requirements and regulations related to insurance and flight operations to Russia,” according to the national carrier and reported by VietnamNet. It is not clear how these issues have been resolved.

Notably, back in November, it was reported that more than half of Russian airlines’ fleet of Airbus A320neo aircraft had been grounded due to engine problems that they were struggling to remedy on the back of Western sanctions limiting access to new parts.

With Russia being a key source of tourist arrivals for Vietnam (about 2 percent in the first two months of the year) grounded Russian airlines could create problems for the local tourism industry. If this was driving the resumption of flights, despite the risks, this would make sense.

The week ahead

There are a handful of events coming up this week. For more information, see: Doing Business in Vietnam: Events Directory 2025.

Of note: If you’re looking for an in-depth assessment of anything to do with the business environment in Vietnam, I do take commissions and I am always open to collaborate. You can reach me on LinkedIn – Mark

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