Kenno Vietnam Pulse

As Vietnam continues to thrive among Asia’s top destinations for foreign investment, we are committed to keeping our global audience informed about key developments through the Kenno Vietnam Pulse series.

In July, Vietnam recorded its highest second-quarter GDP growth in over a decade, alongside a significant rise in public investment and resilient export activity. While macro uncertainties remain, the country laid out clear plans for other structural drivers, including infrastructure upgrades. In this update, we highlight key developments in energy, tech, and transport that support Vietnam's long-term domestic growth.

Macroeconomic Highlights

Record-high Q2 GDP growth

Vietnam’s GDP expanded by 8.0% YoY in Q2 2025, the strongest second-quarter performance since 2011, bringing first-half growth to 7.5%. This increase was broad-based, with industrials up 9.0% and services up 8.5%, supported by improved internal demand and easing external headwinds. Public investment bounced back from a slow Q1 to 71% YoY growth in Q2, thanks to improved regulatory disbursement. Exports rose 14.4% in the first six months despite U.S. tariff pressures.

kenno_vietnam_pulse_july_2025_gdp Data: General Statistics Office

Trade policy resolution with the U.S.

The Trump administration officially introduced a 20% tariff on Vietnamese exports and a 40% tariff on transshipped goods, down from the initially proposed 46%. While implementation details and impacts remain unclear, this signals that Vietnam’s early engagement has paid off as one of the first countries to negotiate and secure a trade deal with the U.S. The reduced uncertainty allows manufacturers and FDI enterprises to focus on operations and planning in the new environment.

Vietnam's first LNG power plants set for Q3 launch

kenno_vietnam_pulse_july_2025_lng Nhon Trach 3 and 4 LNG power plants in Dong Nai.
Photo: PetroVietnam Power

Nhon Trach 3 and Nhon Trach 4, Vietnam’s first LNG-fired power plants with an investment of USD 1.4 billion, are on track to begin commercial operations in the next several months. This complex is expected to supply nine billion kWh of electricity per year to the national grid.

Located in Dong Nai province with a designed capacity of 1,624 MW, these projects aim to meet rising energy demand, especially in southern industrial zones. We think they also represent a meaningful step in diversifying Vietnam’s energy mix and improving reliability for long-term industrial development.

Data centers identified as key national infrastructure

kenno_vietnam_pulse_july_2025_data Server room inside a data center in Ho Chi Minh City.
Photo: FPT Telecom

According to a recent regional report by Cushman & Wakefield, Vietnam ranks just behind Singapore as the second-most attractive market in Asia-Pacific for data center yield-on-cost. The government has now officially classified data centers as a high-priority technology sector, with policies aimed at accelerating investment and development.

Strong macro fundamentals, including high digital demand, low development costs, and proactive government support, enhance the sector’s appeal to foreign investors. With focused expansion from big tech corporations like our portfolio company FPT, we can see a growing role of data infrastructure in supporting Vietnam’s digital transformation and regional competitiveness.

Gia Binh Airport to become North Vietnam's transport hub

kenno_vietnam_pulse_july_2025_airport Render of core sections at Gia Binh Airport in Bac Ninh.
Photo: Vietnam Government Portal

The Ministry of Construction has significantly increased the scale of the Gia Binh International Airport project in Bac Ninh, targeting an annual capacity of 30 million passengers by 2030 and 50 million by 2050. The facility is set to surpass Hanoi's Noi Bai Airport and become the second-largest in Vietnam after Long Thanh Airport.

This is part of a broader push to operate 30 airports nationwide by 2030, supported by USD 17 billion in planned investment. Large-scale airport projects like Gia Binh and Long Thanh are expected to significantly boost domestic travel and strengthen Vietnam's logistics capacity.

Economic growth targets further revised up for 2025

kenno_vietnam_pulse_july_2025_targets National hybrid conference chaired by PM Pham Minh Chinh.
Photo: Vietnam Government Portal

On July 16, Prime Minister Pham Minh Chinh proposed an upward revision to Vietnam’s 2025 GDP growth target, to the range of 8.3–8.5% from the previous 8.0%. This reflects confidence in the country’s fundamentals and sustained momentum since the start of the year.

In addition to Vietnam's core drivers - domestic consumption, exports, and foreign investment - the PM called for greater focus on emerging sectors, the circular economy, and digital transformation. While institutional reform remains key, we believe private sector acceleration will also be essential to meet this goal.

Stay in the know!

And that’s a wrap for this month’s edition of Kenno Vietnam Pulse. We hope you enjoyed reading and found valuable insights into Vietnam’s market landscape. Feel free to subscribe to our monthly newsletter more timely, factual, and actionable updates. If you would like closer look at investment opportunities in Vietnam, we invite you connect with us for more information and tailored advice.