Vietnam s next cycle capital shifts from low cost manufacturing to higher value investment and M A
KPMG s Vietnam s Next Cycle briefing series opened in Singapore on August 25 bringing investors and business leaders together to examine the capital flows reforms and deal activity shaping Vietnam s next phase of growth
Business leaders, investors and senior advisers convened in Singapore for KPMG's Vietnam's Next Cycle briefing. The gathering marked a shift from the previous focus on factory locations to a new emphasis on technology, research and development, regional functions and capital investments. Singapore, as Vietnam's second-largest foreign investor with nearly $97 billion in cumulative registered investment capital across more than 4,500 projects, was chosen to host the first stop of the briefing series.
The relationship between Singapore and Vietnam has deepened structurally, with the two countries elevating ties to a Comprehensive Strategic Partnership in March 2025. The partnership expands cooperation into energy connectivity, the digital economy, innovation and capital markets. Vietnam's economy grew to approximately $514 billion in 2025, with GDP growth of 8.02 percent, its second-strongest year since 2011.
In the first half of 2026, registered foreign direct investment (FDI) reached $34.65 billion, up 61 percent year-on-year, while disbursed FDI rose 11.2 percent to $13.03 billion, the highest first-half implementation in five years. Despite the growth in FDI, the gap between commitments and deliveries is narrowing, signaling that investors are becoming more selective.
Investors are increasingly targeting advanced manufacturing, semiconductors, AI, digital infrastructure, renewable energy, healthcare, and financial services, as Vietnam transitions from a low-cost production base to a more diversified investment ecosystem. Vietnam is pursuing ambitious reform programs aimed at attracting higher-quality capital, with private sector contributions to GDP expected to reach 55-58 percent by 2030 and 60 percent by 2045.
The government's growth ambitions are set at approximately 10 percent annually, supported by large-scale infrastructure projects. For investors, the practical implication is that Vietnam's policy direction is now clear enough to underwrite, although execution risk remains. M&A interest is growing as Vietnamese enterprises scale and international investors seek established positions.
Governance frameworks, reliable reporting, and credible value creation plans are becoming essential for investors.
Written by urgent.news from Vietnam Investment Review's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
