Vietnam’s trade flows reached 930 billion dollars in 2025, consolidating the country’s transformation beyond its function as simple anti-China manufacturing relocation. Foreign direct investments realized reached 27.62 billion dollars, an increase of 9% year-on-year, testifying to a technological upgrade that is redefining its position in global value chains.
This evolution reveals a Vietnamese industrial ecosystem that is gaining autonomy while remaining paradoxically dependent on Chinese inputs. The strategic challenge now consists of balancing domestic innovation and regional integration in a tense geopolitical context.
An Accelerated Technological Upgrade
Vietnam is implementing a national semiconductor strategy through 2030, relying on the presence of giants like Samsung and Intel. Vietnamese semiconductor assembly and testing capacity is expected to increase from its current 1% to 8-9% of global capacity by 2030.
This transformation is supported by concrete investments. Viettel is building Vietnam’s first semiconductor chip manufacturing plant at the Hoa Lac technology park in Hanoi, while FPT is developing a semiconductor assembly and testing plant. Qualcomm has launched its third largest AI R&D center in Vietnam, and NVIDIA has signed agreements with the government to expand research in AI and semiconductors.
The local technology ecosystem is strengthening. Vietnam’s computer science market has more than 530,000 computer engineers, with 153 universities and training institutes producing approximately 50,000 computer science graduates per year. Electronics represent more than 33% of Vietnam’s total exports, with computer and component exports exceeding 107 billion dollars in 2025.
Electric Vehicles, New Industrial Pillar
Vietnam is methodically building an integrated electric vehicle sector. The government aims for the production of one million electric vehicles by 2030, with VinFast posting sales growth of over 470% in early 2025.
This strategy is built on mastery of the battery value chain. VinES is developing a 5 GWh LFP battery plant in Ha Tinh in partnership with Chinese company Gotion High-Tech, while LG Energy Solution is planning an electric vehicle battery production and assembly facility in Phu Tho.
This technological upgrade illustrates Vietnam’s strategy: absorbing Chinese technologies while developing its own capacities. The country is no longer merely assembling; it is designing and producing critical components.
The Persistence of Chinese Chains
Despite this ambition for autonomy, Vietnam remains strongly integrated into Chinese value chains. Vietnam-China trade reached more than 136 billion dollars in the first seven months of 2025, up 21.3% year-on-year. 40% of imported components for electronics still come from China.
This dependency is reflected in trade structure. China remains Vietnam’s leading trading partner, representing 40.2% of total national imports, compared to 37.31% the previous year. Imports from China surged in early 2025, notably in electronics, tools, plastics, and automotive parts.
This interdependence reveals a paradox: Vietnam is developing its technological capacities while strengthening its ties with the Chinese economy. The country offers practical common ground, close enough to China to maintain operational continuity, yet distinct enough to provide significant diversification.
A Laboratory of Globalization 3.0
Vietnam crystallizes the new logics of post-Covid industrial localization. Companies are massively adopting “China+1” strategies to diversify their supply chains. Apple plans to reduce its China-based production from 95% to approximately 75% by 2025, relocating part of its manufacturing to Vietnam.
This reconfiguration is built on structural advantages. Vietnamese labor costs (3 dollars per hour) remain lower than China’s (6.50 dollars). The country has built one of Asia’s most extensive portfolios of free trade agreements, notably CPTPP, EVFTA, and RCEP, offering preferential access to major economies.
Geographical positioning amplifies these advantages. With more than 3,200 kilometers of coastline, Vietnam offers direct access to the world’s most frequently used commercial routes via its deep-water ports.
Challenges of the Autonomous Ecosystem
Despite these advances, Vietnam faces structural bottlenecks. Logistics costs represent 16.5% of GDP, and ports such as Cat Lai and Hai Phong face congestion. Infrastructure bottlenecks and skills shortages must be addressed to meet the demands of emerging industries such as AI and robotics.
Regulations are evolving to support this transition. The Digital Technology Industry Law, enacted on June 14, 2025, aims to attract investments, stimulate innovation, and cultivate high-quality human resources. Innovative startups in AI and semiconductors benefit from tax incentives and can receive direct funding for training, R&D, and pilot production.
Vietnam is navigating between technological ambition and geopolitical realities. Its success will depend on its capacity to develop an innovative ecosystem while preserving its integration in regional value chains. This delicate equation will define its role in globalization 3.0: strategic partner rather than defensive alternative to China.
Sources
- Vietnam Manufacturing Landscape - 2025 Overview and Trends
- Vietnam Manufacturing Investment Guide 2025-2030
- Foreign Direct Investment in Vietnam - Mekong Capital
- Vietnam’s export situation in the first seven months of 2025
- Vietnam Trade Partners 2025 Data Insights
- Accelerating Ahead: How Vietnam is Building a Competitive Semiconductor Hub - SEMI
- Vietnam’s Digital Tech Industry Law - Tilleke & Gibbins