Vietnam’s Offensive to Become Asia’s Economic Laboratory
54,000 companies invested or reinvested in the Vietnamese market in January 2026, a 62% increase compared to one year earlier. This sharp acceleration reveals the scope of the controlled liberalization strategy launched by Hanoi to transform the country into an international financial center.
Vietnam is targeting an annual growth rate of more than 10% by 2030, after recording 8.02% in 2025. This ambition is built on structural reforms unprecedented since the Đổi Mới policies of 1986. The objective: to test a hybrid model between state capitalism and market economy that could inspire other emerging economies facing current geopolitical tensions.
The Silent Administrative Revolution
The Vietnamese government has eliminated the business license tax starting in 2026 and exempts startups from corporate income tax for two years, followed by a 50% reduction over the following four years. The new investment law eliminates licensing requirements for 38 conditional business sectors and allows foreign investors to establish a company before obtaining an investment registration certificate.
Local authorities must now allocate at least 20 hectares per industrial park or 5% of total territory for high-tech companies, SMEs and startups. This obligation practically transforms access to land, the major obstacle to business development.
The country is revising its regulatory enforcement strategy, moving from a logic of “permission before operation” to a policy of “operate if compliant and demonstrate compliance during inspection.” This procedural shift represents a major break with forty years of centralized socialist bureaucracy.
The Fiscal Equation of Competitiveness
Rather than relying primarily on fiscal incentives to attract foreign capital, the country is now focusing on strengthening the foundations of its investment ecosystem with the introduction of the global minimum tax framework. Vietnam’s adoption of global minimum tax rules in 2023 makes fiscal incentives less relevant.
This transition is accompanied by an attractiveness strategy based on infrastructure and human capital. The government’s commitment to reducing administrative barriers, improving access to land and capital, and introducing targeted fiscal and financial incentives signals a shift toward a more market-oriented and investor-friendly framework.
Resolution 139 mandates facilitated access to land to improve business efficiency and production. Special economic zones offer preferential corporate tax rates of 10% for the first 15 years for companies operating in these zones.
The Geopolitical Test of Foreign Direct Investment
In 2025, Vietnam approved 4,054 new FDI projects with a total registered capital of $17.3 billion. Although the number of newly approved projects increased 20.1% year-on-year, registered capital declined 12.2%, reflecting a trend toward smaller projects.
Manufacturing and processing continue to attract the largest share of new FDI, receiving $9.8 billion, representing 56.5% of newly registered capital. Real estate follows with nearly $3.7 billion, representing 21.2%.
According to government statistics, Vietnam’s FDI stock stood at more than $322 billion at the end of 2024, approximately two-thirds of Vietnamese GDP. This massive dependence on foreign capital entirely structures the liberalization strategy: Vietnam can no longer afford to frighten investors with bureaucratic burdens.
The Challenges of Economic Upgrading
Vietnam is targeting double-digit GDP growth in 2026 through high-value-added sectors such as semiconductors, the digital economy, advanced manufacturing and renewable energy. The country is entering a decisive transition from a traditional growth model based on labor cost advantages toward a more sophisticated, high-value-added economy oriented toward innovation.
Despite being the main driver of growth, private companies face numerous difficulties, including legal issues related to land, rising costs such as a 30% increase in logistics expenses and higher wages. Although private investment growth improved in 2024, it reached only 7%, significantly lower than the pre-pandemic rate of 17%.
Private investment should be encouraged as a crucial growth engine while FDI attraction should become more selective, linked to technology transfer, environmental protection and stronger connections with domestic companies. Vietnam must move from a model dependent on capital and labor toward a model based on productivity gains, efficient resource allocation and economic restructuring toward sustainability and modernity.
Experimenting with a Hybrid Model
Vietnam is testing an original path between socialist dirigisme and economic liberalism. The Vietnamese economic system is described as “crony capitalism” where a “state-party-business alliance” occupies the “commanding heights” in politics and economics. Vietnam’s assertion of being a “socialist republic” and a “socialist-oriented market economy” is a political myth.
This controlled liberalization strategy could inspire other emerging economies seeking to attract investment in a tense geopolitical context. Internationally, Vietnamese “bamboo diplomacy” seeks to balance relations with the United States and China.
To accelerate growth dynamics through 2030, the Vietnamese government has set ambitious macroeconomic objectives—raising average annual GDP growth to more than 8% in 2021-2030, with the 2026-2030 phase targeting at least 10% annually. By 2030, Vietnam’s GDP per capita at current prices should reach approximately $8,500, rising to approximately $38,000 by 2050 according to its long-term development vision.
The stakes go beyond simple national economic development. Vietnam is testing whether an authoritarian regime can conduct deep economic liberalization without major political concessions, challenging the Western model that traditionally links economic reforms and progressive democratization.
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