In the evolving landscape of global investment, Vietnam’s technology sector has become a focal point for international investors, particularly those from Singapore and Hong Kong. The country’s rapidly expanding IT industry is not only fueling economic growth but also positioning Vietnam as a global hub for technology-driven innovation. Following our exploration in Episode 1 of why Vietnam is an attractive destination for investment, we now delve into one of the most promising sectors: Vietnam’s IT industry. With a growing, young workforce, a government committed to digital transformation, and an increasingly dynamic startup ecosystem, Vietnam offers compelling opportunities for investors seeking to capitalize on the IT sector’s expansion.
As the demand for digital solutions surges globally, Vietnam is harnessing its resources to establish itself as a regional powerhouse in the tech industry. For investors from Singapore and Hong Kong, this rapidly growing IT sector represents a unique and lucrative opportunity. This playbook explores the key drivers behind Vietnam’s IT boom and why it is positioned to become an even more attractive destination for tech-focused investments.
1. The Young, Abundant, and Cost-Effective Workforce
One of the key advantages of investing in Vietnam’s IT sector is the country’s highly skilled, young, and cost-effective workforce. With a population of over 100 million people, Vietnam boasts a demographic advantage that many other countries lack. Over 500,000 students graduate annually in fields related to technology, producing a steady stream of young, talented professionals eager to contribute to the country’s digital economy.
The availability of this highly educated labor force offers significant cost advantages for foreign investors. When compared to more established markets like India, China, or the Philippines, labor costs in Vietnam are notably lower while the quality of work remains high. For investors in Hong Kong and Singapore, this means that they can access a well-trained and productive workforce at a fraction of the cost of hiring talent in traditional tech hubs.
Take FPT Software, one of Vietnam’s largest technology companies, for example. FPT has become a strategic partner for multinational companies around the world, including large corporations from Japan and the US. With a given budget, foreign companies can hire 3 to 5 software engineers in Vietnam for the cost of just one engineer in the US or Japan. This cost-effective labor is a major factor driving the growth of the IT sector in Vietnam and making it an attractive outsourcing destination for software development, IT services, and digital transformation projects.
2. Supportive Government Policies: Laying the Groundwork for Continued Growth
Vietnam’s government has played a crucial role in the expansion of the IT sector by creating a favorable environment for both local startups and multinational corporations. Through several forward-thinking initiatives and reforms, the government has laid a strong foundation for the country’s continued growth in the digital economy. For example, the Vietnam Digital Transformation Program is designed to promote innovation, upskill the workforce, and integrate cutting-edge technologies across various industries.
For investors from Singapore and Hong Kong, these government policies not only provide an enabling environment but also offer significant growth potential. The government’s commitment to digital transformation and fostering smart technologies makes Vietnam an attractive long-term investment destination. The country’s focus on digitizing industries like manufacturing, healthcare, agriculture, and education is creating significant demand for IT services and solutions.
Additionally, Vietnam’s favorable tax incentives and investment laws further enhance its appeal. Foreign investors enjoy tax exemptions for certain types of investments and the flexibility to repatriate profits, which makes Vietnam an attractive destination for venture capitalists and foreign investors looking to scale their operations in the IT sector.
Vietnam’s regulatory framework has also adapted to global digital trends. For instance, Resolution No. 05/2025/NQ-CP on piloting the crypto asset market is a landmark decision that officially recognizes and legalizes digital assets. This move signals Vietnam’s readiness to adopt emerging technologies such as blockchain and cryptocurrency, which will help unlock new investment opportunities and pave the way for innovation in the country’s digital economy.
3. Dynamic Startup Ecosystem: Innovation at the Forefront of Growth
Vietnam’s startup ecosystem is another significant driver behind the booming IT sector. The country’s entrepreneurial spirit has given rise to numerous tech startups that are disrupting traditional industries and making waves both regionally and globally. From fintech and e-commerce to artificial intelligence (AI) and blockchain, Vietnamese startups are capitalizing on the opportunities presented by the digital revolution.
For investors from Hong Kong and Singapore, the vibrant startup ecosystem in Vietnam offers exciting opportunities to participate in groundbreaking ventures. The country’s young, tech-savvy population, combined with an increasingly supportive regulatory environment, has positioned Vietnam as an ideal hub for innovation. With a growing number of local startups attracting significant funding from international venture capitalists, now is the time to invest in Vietnam’s next big tech success story.
Vietnam’s venture capital market has grown exponentially in recent years, with several successful startups making headlines for securing substantial funding. Companies like MoMo (a leading fintech platform) and Sky Mavis (the company behind the globally popular game Axie Infinity) have raised millions of dollars in investment. Additionally, Tiki, an e-commerce platform, raised more than 440 million USD in funding and is now recognized as one of Vietnam’s most successful technology unicorns.
These success stories underscore the potential for investors to tap into Vietnam’s growing tech scene. By investing in Vietnamese startups, foreign investors not only gain exposure to high-growth opportunities but also contribute to the evolution of Vietnam’s digital economy.
4. IT Infrastructure: Ready for Global Expansion
As Vietnam’s IT sector grows, so too does its technological infrastructure. The country has made significant strides in building a robust digital ecosystem that supports businesses of all sizes. This includes the development of advanced data centers, fiber optic networks, and cloud computing capabilities. With these advancements, businesses can operate with greater speed, reliability, and security, which is essential for both local and international companies seeking to scale.
For foreign investors, these infrastructure developments provide confidence in Vietnam’s ability to handle large-scale IT operations. The country is increasingly becoming a preferred destination for global companies looking to set up research and development (R&D) centers. The IT infrastructure in Vietnam is not only capable of supporting domestic business operations but also seamlessly integrates with global supply chains.
The presence of global tech giants further reinforces Vietnam’s position as an emerging IT hub. Samsung, for instance, has invested heavily in manufacturing and R&D centers in Bac Ninh and Thai Nguyen, transforming Vietnam into a global manufacturing and innovation center. Similarly, Intel has invested more than 1 billion USD in a chip assembly and testing facility in Ho Chi Minh City, underscoring Vietnam’s role in the global semiconductor supply chain. Additionally, Nvidia has announced plans to establish a semiconductor chip design and AI training center in Vietnam, further elevating the country’s status in high-tech industries.
5. Global Trends and Investment Shifts
The growth of Vietnam’s IT industry is not just a fleeting trend but part of a long-term evolution driven by both global market trends and Vietnam’s proactive policies. As demand for IT services and digital solutions continues to rise, Vietnam is positioning itself as a key player in the global IT outsourcing and software development markets. According to Kearney’s Global Services Location Index 2023, Vietnam has successfully entered the top 7 countries for IT outsourcing (ITO), surpassing several traditional outsourcing hubs.
Additionally, Vietnam ranks 2nd in Southeast Asia for software outsourcing services, just behind India, highlighting its growing importance in the global IT ecosystem. As global companies increasingly look for cost-effective, high-quality tech solutions, Vietnam is becoming the go-to destination for IT outsourcing, software development, and digital transformation services.
For investors in Singapore and Hong Kong, these global trends provide an opportunity to tap into a rapidly growing market that offers both cost advantages and access to cutting-edge technology. With a government committed to digital transformation and a burgeoning startup ecosystem, Vietnam is poised to continue its growth trajectory and solidify its position as a leader in the global IT sector.
Conclusion:
Vietnam’s IT industry is not just a growing sector—it is a global powerhouse in the making. With its young, highly skilled workforce, government-backed initiatives, dynamic startup ecosystem, and world-class infrastructure, Vietnam offers a wealth of opportunities for Singapore and Hong Kong investors looking to capitalize on the future of technology. The country’s proactive approach to digital transformation and its ability to attract global players make it an ideal destination for those seeking long-term growth in the IT space.
As the tech landscape in Vietnam continues to evolve, now is the perfect time to invest. The opportunities are vast, and the rewards for early investors could be significant. Premia TNC is here to help you navigate the Vietnamese market and capitalize on the burgeoning IT sector. Get in touch today for a FREE consultation and learn how we can support your business expansion into Vietnam.