Vietnam – Potential destination for innovation capital flows

Capital flows remain strong amid tightening market

NIC and VPCA signed a series of bilateral Memorandums of Understanding with three leading investment associations in Asia. Photo: Thanh Hien

Despite the global economic slowdown and tightening capital markets, Vietnam still recorded $2.3 billion in investment capital disbursed through 141 deals in 2024.

The deal activity was supported by strong fundamentals, indicating that investor confidence remains strong amid weakening global venture capital and private equity flows.

Along with that, Vietnam also has a combination of rare favorable factors, such as GDP growth reaching 7.1% in 2024, higher than most Asian economies. The economic scale is expected to reach 1,100 billion USD in 2035, 2.5 times higher than the current; 25 billion USD of FDI capital will be disbursed in 2024, an increase of 9% over the same period; the middle class is expected to account for 46% of the population in 2030; the digital economy currently contributes 18.3% of GDP, aiming for 35% in 2030...

Despite a 35% decline in total private equity, investor participation remains robust. Nearly 150 venture funds are expected to be active in 2024. Deals under $500,000 are up 73%, demonstrating the resilience of the startup ecosystem…

In addition, Vietnam is also emerging as a destination for new-generation technology fields, with investment in AI startups increasing eightfold compared to last year; investment in high-tech agriculture increasing ninefold; the number of green technology deals doubling...

Mr. Ben Sheridan, Global Director of Investment - Finance at BCG shared: "We are entering the golden age of private capital in Vietnam".

A representative of Nvidia Corporation said that Vietnam was chosen as the corporation's strategic investment location. Vietnam is attracting many large enterprises in the world, developing smart factories, applying AI to solve many big problems, such as traffic congestion, healthcare development...

Ecosystem ready for scale

Deputy Prime Minister Nguyen Chi Dung and delegates launched the cooperation minutes.
Photo: Thanh Hien

According to Deputy Minister of Finance Nguyen Duc Tam, the Government has identified the development of science, technology, innovation and digital transformation as the “backbone” of modernization and growth promotion. Therefore, attracting and effectively using all private resources to invest in technology is a contribution to realizing the aspiration of making Vietnam a developed, high-income country by 2045.

Vietnam is promoting strong reforms in the financial sector, from restructuring the capital market, aiming to build an international financial center, to perfecting the legal framework for blockchain technology. These advances contribute to increasing transparency in capital flows, minimizing risks for foreign investors, and gradually moving towards the goal of upgrading the country's credit rating.

Ms. Le Hoang Uyen Vy, Chairman of VPCA and CEO of Do Ventures, shared that Vietnam has transformed from a potential market to a country ready to break out, emerging as a destination for sustainable growth and innovation. Vietnam has every opportunity to lead the next wave of growth in Asia in the context of global uncertainty.

Deputy Prime Minister Nguyen Chi Dung affirmed that connecting and unlocking investment capital for science, technology, innovation and digital transformation is a world trend.

"We can see the potential and opportunities of the Vietnamese market, from the results announced in the Innovation and Private Investment Report 2025 to the strong commitments of investment funds, technology enterprises and international partners through the signing of investment cooperation agreements.

However, we need to act quickly and decisively to turn commitments and memorandums of understanding into investment decisions and cooperation contracts; and turn potentials and advantages into economic efficiency," the Deputy Prime Minister said.

Deputy Prime Minister Nguyen Chi Dung suggested that the subjects of the innovation ecosystem, investment funds, innovation and startup enterprises continue to propose institutions and policies to create open and favorable conditions for private investment funds operating in Vietnam, especially funds with priority investment portfolios for emerging technology, high technology, and strategic technology.

On that basis, the Government will continue to improve the legal environment to encourage innovation, testing and commercialization of technology, while enhancing cooperation, connection and experience sharing with international partners in this field.

Ministries, branches, research institutes, universities, and innovation centers continue to play the role of supporting and promoting agencies, creating an open and transparent "playground" for businesses, funds, organizations, and individuals to invest in innovation and startups.

On April 22, at the National Convention Center, the Vietnam Innovation and Investment Forum (VIPC) 2025 took place.

The forum was organized by the National Innovation Center (NIC - Ministry of Finance) in collaboration with the Vietnam Private Equity Organization (VPCA). Deputy Prime Minister Nguyen Chi Dung attended the event.

With the theme “Promoting innovation, unlocking private capital, bringing Vietnam into the era of growth”, the forum gathered more than 1,000 delegates representing ministries, sectors, localities, enterprises and more than 200 domestic and foreign investors.

Delegates focused on discussing Vietnam's key industries, policies and vision, sharing about divestment opportunities, cross-border development opportunities in the fields of fintech, AI and deep tech, high-tech manufacturing, capital market development and cross-border business expansion.

Also at the forum, NIC and VPCA signed a series of bilateral memorandums of understanding with three leading investment associations in Asia, including: Korea Venture Capital Association (KVCA), Singapore Venture Capital and Private Equity Association (SVCA) and Hong Kong Venture Capital and Private Equity Association (China).

Together, the three institutions manage a combined $5 trillion in assets. This is the first time that Asia’s major private equity firms have formally joined forces, creating a regional investment bloc with common goals and coordinated actions.

Source: https://hanoimoi.vn/viet-nam-diem-den-tiem-nang-cua-dong-von-doi-moi-sang-tao-699930.html