Why Vietnam

Vietnam’s population stood at 101 million in January 2025. As the working-age population expands, Vietnam’s so-called ‘demographic dividend’ will provide the foundation for future growth and productivity.

The availability of a young and increasingly skilled workforce is attracting record levels of foreign investment, while rising disposable incomes are driving demand for foreign goods and services across a range of sectors.

Vietnam is also playing a prominent role on the global stage. It is an active and influential member of the Association of Southeast Asian Nations (ASEAN) and has nurtured close partnerships with both the US and China. As a strategically positioned, export-oriented economy, it is utilising new bilateral and multilateral free trade agreements to boost international trade and investment.

The political and economic relationship with Australia has also deepened. In March 2024, both countries elevated the relationship to a Comprehensive Strategic Partnership. Over the last decade, bilateral visits have increased and economic cooperation has expanded, including through the 2021 Australia-Vietnam Enhanced Economic Engagement Strategy. In 2023-24, two-way trade was valued at AUD 28.2 billion.

Vietnam has been identified as a key market for two-way trade and investment in the Australian

Government’s Southeast Asia Economic Strategy to 2040. More information on the bilateral relationship is available in Section 5.1 and from the Department of Foreign Affairs and Trade’s Vietnam Country Brief.

This context presents clear opportunities for Australian businesses. As bilateral ties deepen and Vietnam continues to implement business-friendly policies designed to drive trade and investment, it is an ideal time for Australian companies to consider the Vietnamese market.

Comparing key indicators: Vietnam and Australia

Vietnam’s economy has transformed since the early 1990s, lifting millions out of poverty and elevating it to middle-income status. As part of this transformation, agriculture has shrunk as a share of economic output, while manufacturing and services have grown.

State-owned enterprises are playing less of a role as business reforms boost private sector growth. And international trade has boomed, with Vietnam now one of the most trade intensive economies in the world. These fundamental shifts will underpin Vietnam’s long-term economic development.

Vietnam’s economic outlook over the short to medium-term will be determined by a range of factors. After a bounce in 2024, real GDP growth is forecast to retreat to 5.2 per cent in 2025. Household incomes are expected to grow as the manufacturing sector recovers and, coupled with the government’s ongoing wage reform measures, private consumption is likely to increase. Improving demand in major export markets will drive manufacturing, while services will receive a boost from the recovering tourism sector. The Politburo has unveiled four cornerstone resolutions—covering innovation, international integration, legal reform, and private sector development—to drive institutional renewal and support Vietnam’s ambition of achieving upper-middle-income status by 2030 and high-income status by 2045.

Figure 1: Real GDP Growth - Vietnam and world average (2016-2026f), %

Vietnam’s strong economic growth presents opportunities for Australian trade and investment. These opportunities are particularly strong in sectors that align with Vietnam’s economic development priorities and growing consumer class. This section provides a short overview of prospective sectors.

Education

Skills development is a key priority for the Vietnamese Government. In 2025, Vietnam was Australia’s fourth- largest source of international students, with over 33,000 enrolments contributing AUD 1.5 billion to education-related exports – up from just 3,000 enrolments two decades earlier. The Vietnamese Government’s ambitious education and training reforms present opportunities for international collaborations and partnerships across a range of sectors. Recent reforms on foreign cooperation in education and the University Network Plan, now enable leading global universities ranked in the top 500 to establish foreign branch campuses in Vietnam, offering accredited international qualifications without needing further state approval. Austrade has identified opportunities in higher education, vocational education and training, schools and emerging edtech.

Food and agribusiness

Rising consumer spending and changing lifestyles are increasing demand for food, beverage and agricultural products in Vietnam. As incomes grow, Vietnamese consumers are showing greater interest in novel food and beverage items, particularly health-oriented

and premium products. Australian agrifood produce continues to be seen as safe and high-quality and Australian suppliers of dairy are expected to benefit from the rollout of supermarkets and hypermarkets. Austrade has also identified opportunities for Australia’s core agribusiness industries – including live cattle and wheat – that are expected to grow as Vietnam’s economy continues to mature, and emerging opportunities for Australian agricultural technology businesses as Vietnam modernises its farming and fishery sectors.

Health and medical

The Vietnamese Government aims to achieve universal health coverage by 2030, bringing it in line with neighbours Thailand, Indonesia and the Philippines. This will drive growth in the healthcare and pharmaceuticals sectors. Preferential tax

conditions for foreign participation in the healthcare sector have been introduced, creating opportunities for investment. In the coming decades, aged care will also become an important sub-sector. Opportunities for Australian aged care providers will emerge, including in management and staff training, as well as medtech and health-tech products and services.

Technology

Vietnam’s rapid digitisation and growing e-commerce ecosystem present new opportunities for Australian businesses across software, digital content, telecommunications and hardware. Demand for software solutions in the banking and finance, aviation and telecommunication sectors is growing as the privatisation of state-owned enterprises continues. Rapidly changing digital trends are presenting opportunities for Australian technology firms to provide payment solutions, digital marketing and cybersecurity. Vietnam has introduced special fast-track procedures and tax and land incentives for high-tech, digital and innovation projects—helping investors begin construction up to 260 days sooner and access support in areas like R&D, AI, semiconductors, and digital infrastructure.

Green economy

Vietnam’s green economy transition presents a range of opportunities for Australian businesses. As energy demand continues to grow, Vietnam will require the sustainable technologies and clean-energy expertise to meet its net zero target by 2050. The Vietnamese Government’s Power Development Plan 8 (PDP8) plans to expand renewables and cut coal reliance.There are opportunities for Australian businesses across the life cycle of the energy transition, from planning and development to operation and maintenance.

Opportunities to develop and strengthen energy supply chains are emerging, and there is potential for Australian businesses to collaborate on solar, electric vehicles and battery storage supply chains. Austrade has identified opportunities in hydrogen and power generation solutions. Asialink’s Australia-Vietnam Green Economy Program offers insights, training and networking opportunities for businesses in the green economy.

Infrastructure, transportation and cities

Vietnam is investing heavily in infrastructure, transportation and urban development. It spends around 6 per cent of GDP in these sectors,

making it the leading country in Southeast Asia for infrastructure investment. Major initiatives around transportation, port, telecommunication and energy infrastructure have been announced, with a push for private investment and public-private partnerships (PPP) to fill a shortfall in funding. Over the short-term, opportunities exist for Australian businesses in the early stages of PPP transport infrastructure projects, including highways, airports and waterways. Over the medium- to long-term, opportunities will emerge across architecture, consultancy and engineering services, construction and project management.

Austrade has identified infrastructure as an opportunity, including airport solutions, sustainable building solutions and roads, rail and ports.

Professional and financial services

Vietnam’s professional and financial services sector is growing as the country pivots to a more productive and diverse economy. Currently accounting for around 42% of GDP in 2024, Vietnam aims to increase the service sector’s contribution to two-thirds of GDP by 2030 – closing the gap between it and the service-dominated economies of Singapore and the Philippines. Legal, accounting, architecture, engineering and consulting services will be in high demand as the government’s ambitious development plans unfold over the coming decades. As Ho Chi Minh City evolves into a regional financial hub, financial services and fintech are emerging as

key sectors as banks and insurance companies digitise their offerings. These trends will present opportunities for Australian professional and financial services firms, who now enjoy increased market access under the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).

Mining equipment, technology and services (METS)

While Vietnam is endowed with natural resources, many mineral deposits remain unexplored. The Vietnam Mining and Geologies Strategy to 2045 aims to unlock access to deposits of minerals including rare earths – a complex undertaking that will require foreign capital and expertise. Demand for automation, digital solutions, software, sensors and data analytics is expected to grow. As a world leader in mining efficiency, technology and innovation, Australia’s METS sector can help unlock the economic potential of Vietnam’s mineral resources. Austrade has identified METS as a priority trade and investment opportunity in Vietnam.