Industrial parks designed as engines of transformation

Vietnam’s industrial parks (IPs) have been instrumental in the nation’s manufacturing surge since the 1980s. Over 430 IPs have been established, driving export growth and foreign direct investment. Electronics, machinery, and garments have driven export growth, with electronics exports alone nearly doubling between 2020 and 2025. Over half of Vietnam’s export turnover now comes from these zones.

However, Vietnam’s IPs face new challenges as supply chains evolve and technology transforms manufacturing. Infrastructure gaps, skilled labor shortages, and a focus on low-value assembly threaten future growth. Vietnam’s current model, which emphasizes low-cost land and basic manufacturing, has three structural limitations. First, infrastructure is lagging behind global standards, particularly in energy, logistics, and environmental, social, and governance compliance.

Second, the talent gap is widening, with only 24% of the manufacturing workforce formally trained, leaving high-tech sectors like semiconductors in need of specialized engineering talent. Third, Vietnam’s position in the global value chain remains anchored in assembly and low-value activities, with low localization rates in electronics and increasing competition from ASEAN peers.

To transition to higher-value activities, Vietnam must foster innovation, develop technology, and deepen integration with global supply chains. Regional leaders like China, Singapore, and South Korea have transitioned from basic manufacturing parks to integrated, high-tech ecosystems through coordinated public-private action. Vietnam is moving in this direction, with the emergence of eco-industrial and high-tech parks, such as Saigon Hi-Tech Park, and new legislation, including the Law on the Digital Technology Industry, prioritizing strategic sectors and offering targeted incentives.

Ho Chi Minh City is developing 38 new industrial parks over 23,000 hectares by 2030, with a vision to 2050. Vietnam’s industrial property sector is shifting towards green growth, requiring developers to adapt their strategies to an increasingly competitive landscape.