Vietnam’s Data Center Boom: Why Local Partnerships Are Key to Foreign Investment Success
Vietnam is emerging as one of Southeast Asia’s promising data center investment destinations, driven by accelerating digital transformation, rising cloud adoption, and growing demand for artificial intelligence (AI) infrastructure.
The country has also taken significant steps to open its data center industry to foreign investment. Under its revised telecommunications framework, foreign investors can establish wholly foreign-owned data center service businesses, removing a major market-entry barrier.
Yet recent investment activity reveals an interesting trend: rather than pursuing wholly independent operations, several international investors have chosen to collaborate with established Vietnamese companies.
From Sembcorp’s partnership with BB Holding to Evolution Data Centres’ joint venture with HITC, these projects highlight the strategic importance of combining international expertise and capital with local infrastructure, market knowledge, and execution capabilities.
For foreign investors, understanding Vietnam’s market potential is only the first step. The more critical question is how to translate that opportunity into an operationally and commercially viable investment.
1. Market Overview: A Fast-Growing Digital Infrastructure Market
1.1. Market Size and Growth Outlook
Vietnam’s data center market is entering a period of expansion, supported by growing digital infrastructure requirements and increasing international investor interest. Market estimates vary across research providers, partly because of differences in market definitions and forecasting methodologies.
According to Arizton, Vietnam’s data center investment market was valued at approximately USD 1.04 billion in 2025, with projected growth to USD 3.19 billion by 2031, representing a compound annual growth rate (CAGR) of 20.47%. Meanwhile, P&S Intelligence estimates the market at USD 1.42 billion in 2025, forecasting expansion to USD 4.37 billion by 2032 at a CAGR of 17.5%.
Although the estimates differ, both suggest strong double-digit market growth over the coming years. However, the figures should be treated as indicative rather than directly comparable because the underlying market boundaries and forecast periods may differ.
More importantly, recent project announcements suggest that Vietnam is transitioning from a market dominated by conventional enterprise and telecommunications data centers toward a broader ecosystem of hyperscale facilities, cloud infrastructure, and AI-ready computing capacity.
A July 2026 industry review by Market Research Vietnam estimated that announced and proposed AI and data center projects had exceeded USD 7 billion over approximately six months. These figures demonstrate substantial investor interest, although announced investment values should not be confused with committed capital expenditure or completed facilities.
1.2. Key Demand Drivers
Data sovereignty and regulatory compliance
Vietnam’s expanding framework for data protection and cybersecurity has increased the strategic importance of locally hosted and securely managed digital infrastructure.
Requirements affecting particular categories of data and service providers create incentives for enterprises to consider domestic hosting, localized cloud architecture, and compliance-focused infrastructure.
However, Vietnam does not impose a universal localization requirement on all business data. The applicable obligations depend on the nature of the data, the services provided, and the relevant legal requirements. For data center investors, this creates opportunities to serve customers that require secure, resilient, and locally compliant infrastructure.
Cloud adoption and digital economic growth
Vietnam’s expanding digital economy continues to generate demand for computing, storage, and network infrastructure.
Banks are modernizing core systems and digital payment platforms. E-commerce businesses increasingly depend on cloud-based transaction processing, while manufacturers and service providers are adopting enterprise software, automation, and data analytics.
These developments support demand for colocation facilities, cloud services, disaster recovery, and high-availability infrastructure.
Artificial intelligence and high-performance computing
AI represents another growth opportunity. Compared with traditional enterprise workloads, advanced AI applications can require substantially greater computing density, cooling performance, and electrical capacity.
As Vietnamese enterprises adopt AI-driven analytics and automation, infrastructure providers will need to accommodate increasingly sophisticated workloads.
International investors capable of developing energy-efficient, AI-ready facilities may therefore find opportunities beyond conventional server hosting.
1.3. Geographic Concentration: Ho Chi Minh City, Hanoi, and Da Nang
Vietnam’s data center market is concentrated around its principal economic and technology hubs.
Ho Chi Minh City is a leading commercial center for data center development. Its established enterprise base, financial institutions, technology ecosystem, and connectivity infrastructure make it attractive for hyperscale and colocation investment.
Saigon Hi-Tech Park (SHTP) has emerged as a particularly important location, attracting projects involving companies such as Sembcorp, Evolution Data Centres, and CMC.
However, access to land in this strategically important location is increasingly competitive. The park’s investment-screening framework prioritizes large-scale projects, including data center developments exceeding approximately USD 100 million in investment per hectare. This is a site-specific benchmark, not a nationwide requirement.
Hanoi represents another major hub, supported by government institutions, telecommunications operators, financial organizations, and enterprise customers.
Hoa Lac Hi-Tech Park has attracted data center investment and provides an established environment for technology infrastructure development.
Da Nang is emerging as a potential third hub. The city has promoted data center investment within its high-tech park and is positioning itself for growth in AI, cloud services, and digital technology.
For investors, location selection should reflect customer proximity, connectivity, power availability, disaster resilience, and long-term expansion requirements rather than land cost alone.
1.4. Competitive Landscape
Vietnam’s existing data center industry has historically been led by domestic telecommunications and technology companies, particularly Viettel IDC, VNPT, FPT, and CMC.
These companies benefit from established telecommunications infrastructure, customer relationships, and experience operating in Vietnam’s regulatory environment. International participation is increasing, bringing additional development capital, hyperscale expertise, technology partnerships, and international customer networks. The competitive landscape is therefore evolving from predominantly domestic infrastructure provision toward a combination of local incumbents, foreign-backed ventures, and specialized infrastructure operators.
For new investors, this creates opportunities for both greenfield development and strategic partnerships with existing market participants.
1.5. Key Market Constraints
Despite the positive growth outlook, data center development faces several important challenges.
Power availability and grid connection are particularly significant. Large-scale facilities require continuous electrical supply, reliable backup systems, and sufficient grid capacity to support future expansion.
A July 2026 industry review cited estimates that some new developments may need to finance dedicated 110 kV substations costing approximately USD 8–12 million. These figures should be treated as indicative project-specific estimates rather than a universal connection charge.
Land availability presents another challenge, particularly for projects requiring large, expandable sites near major commercial centers. Cooling infrastructure and water management are also becoming increasingly important as investors develop higher-density AI facilities.
Finally, competition for qualified engineers, electrical specialists, cybersecurity professionals, and experienced data center operators may increase as the industry expands.
These constraints reinforce an important investment principle: the commercial value of a data center site depends not only on its location, but also on the feasibility of supplying, connecting, constructing, and operating the facility.
2. Legal Framework: Open Foreign Ownership, Stronger Regulatory Oversight
2.1. Telecommunications Law and Data Center Regulation
Vietnam’s regulatory framework for data center services changed significantly with the adoption of the Telecommunications Law No. 24/2023/QH15.
The law took general effect on July 1, 2024, while its key provisions governing data center and cloud computing services became effective on January 1, 2025.
Decree No. 163/2024/ND-CP provides implementing regulations and establishes specific procedures and obligations for data center service providers.
Together, these reforms formally recognize data center services within the telecommunications regulatory framework.
The changes provide greater legal clarity for international investors while also introducing more structured supervision of service providers.
2.2. Foreign Ownership and Market Entry Options
One of the most significant developments is the removal of the previous foreign ownership limitation for data center services.
Foreign investors can now establish businesses providing data center services in Vietnam with up to 100% foreign ownership, subject to applicable investment, corporate, land, and operational requirements.
Accordingly, investors have several potential entry routes.
Wholly foreign-owned enterprises provide maximum corporate control and may suit investors with established local execution capabilities.
Joint ventures (JVs) allow foreign investors to combine international expertise and capital with a Vietnamese partner’s infrastructure, commercial relationships, or operational resources.
Business cooperation contracts (BCCs) provide a contractual cooperation structure that may be appropriate for certain arrangements without establishing a separate joint venture company.
Foreign enterprises may also provide data center services to Vietnamese users on a cross-border basis, subject to the relevant notification and compliance requirements.
Importantly, permission to establish a wholly foreign-owned service company does not automatically confer unrestricted rights to acquire or use land in Vietnam.
The most appropriate structure depends on the project's location, financing model, governance requirements, and intended customer base.
2.3. Investment Registration and Operational Compliance
For a foreign investor establishing a data center business in Vietnam, market entry generally involves several regulatory steps.
Under the Law on Investment No. 143/2025/QH15, effective March 1, 2026, foreign investment projects generally require an Investment Registration Certificate (IRC), subject to the applicable procedures and exemptions. Establishing a new Vietnamese corporate entity also involves enterprise registration.
Depending on the project, separate investment-policy approval, land allocation or lease procedures, environmental approvals, construction permits, fire-safety requirements, and other regulatory steps may also be necessary.
Before providing regulated data center services, an onshore provider must complete the relevant telecommunications service registration process with the Vietnam Telecommunications Authority (VNTA).
The resulting certificate of registration is distinct from a traditional telecommunications license.
Technical conformity declarations and compliance with applicable operational standards must also be addressed.
The practical implication is clear: Vietnam has liberalized foreign ownership without eliminating regulatory oversight.
Investors should therefore develop a coordinated licensing and compliance roadmap before committing substantial capital.
2.4. Data Protection, Cybersecurity, and Data Localization
Vietnam’s digital regulatory framework continued to evolve throughout 2025 and 2026.
Several laws and implementing decrees are especially relevant:
● Law on Data No. 60/2024/QH15, effective July 1, 2025, together with Decree No. 165/2025/ND-CP.
● Personal Data Protection Law No. 91/2025/QH15, effective January 1, 2026, supported by Decree No. 356/2025/ND-CP.
● Cybersecurity Law No. 116/2025/QH15, effective July 1, 2026, replacing the previous cybersecurity and network information security laws.
● Decree No. 333/2026/ND-CP, effective August 19, 2026, providing updated implementation rules on cybersecurity matters, including data localization.
● Decree No. 330/2026/ND-CP, establishing administrative penalties for violations involving cybersecurity and personal data protection.
The updated cybersecurity framework builds on the earlier approach under Decree No. 53/2022/ND-CP while refining the treatment of regulated data and obligations applicable to domestic and offshore enterprises.
These rules affect data governance, localization assessments, security safeguards, incident response, and cooperation with competent authorities.
For investors, compliance planning should distinguish between the obligations of a data center infrastructure provider and those of its customers, including cloud platforms and businesses processing personal data. A facility located in Vietnam does not, by itself, guarantee compliance with every customer’s data protection obligations.
2.5. Land, Energy Procurement, and Investment Incentives
Data center investments are also affected by regulations beyond the telecommunications sector.
Under the Land Law 2024, foreign-invested enterprises may receive transfers of land-use rights within industrial parks, industrial clusters, and high-tech parks under specified conditions.
However, investors must assess the permitted land-use purpose, lease duration, transfer restrictions, zoning requirements, and other project-specific considerations.
Energy procurement is another major area of regulatory importance. Vietnam’s direct power purchase agreement (DPPA) mechanism under Decree No. 57/2025/ND-CP, as amended by Decree No. 243/2026/ND-CP, creates potential pathways for eligible large electricity users to procure renewable electricity under qualifying arrangements. For data centers, these arrangements may support long-term sustainability objectives, but they do not replace the need to confirm physical grid connection and reliable power supply.
Investment incentives may also be available under relevant investment, high-technology, and digital technology legislation. Eligibility must be assessed against the specific project, activities, location, and applicable conditions rather than assumed for every data center development.
3. Case Studies: How International Investors Are Entering Vietnam
Several recent investment announcements illustrate how foreign companies are approaching Vietnam’s data center sector.
While the arrangements differ in structure and maturity, a recurring theme is the involvement of Vietnamese partners with complementary resources.
3.1. Sembcorp Development × BB Holding: Securing a Strategic Site
Singapore-based Sembcorp Development entered Vietnam’s data center market through StarMason Joint Stock Company, a venture formed with Vietnamese partner BB Holding.
Sembcorp holds a 49% interest in StarMason.
In March 2026, the venture received investment approval to develop a hyperscale and AI-ready data center campus within Saigon Hi-Tech Park.
The project subsequently secured a lease for approximately 4.5 hectares in September 2026.
With registered investment capital of approximately USD 480 million, the facility is designed for an initial capacity of 60 MW, with potential expansion to 90 MW.
The project demonstrates how an international infrastructure developer can pursue a major Vietnamese investment through a locally established venture.
Strategic lesson: A minority ownership position does not necessarily prevent a foreign investor from participating in a major infrastructure opportunity. The value of a partnership can extend beyond equity control to include local project development, site access, and execution capabilities.
3.2. Evolution Data Centres × HITC: Combining Global Expertise with Local Infrastructure
Evolution Data Centres, a Singapore-headquartered data center developer, established a joint venture with HTC International Telecommunication JSC (HITC) in December 2025. The partnership aims to develop hyperscale and AI-ready data center infrastructure across Hanoi and Ho Chi Minh City.
In Hanoi, the venture's platform includes HITC's existing EcoDC facility within Hoa Lac Hi-Tech Park. The platform also includes a planned hyperscale development in Ho Chi Minh City's Saigon Hi-Tech Park.
In August 2026, Evolution secured a land lease for approximately five hectares for the southern development. The proposed facility is planned to support approximately 52 MW of IT load. The arrangement combines Evolution’s international data center development experience with HITC’s established telecommunications infrastructure and domestic market knowledge.
Strategic lesson: Partnering with a local telecommunications infrastructure provider can offer access to existing assets, connectivity capabilities, and established technical operations while supporting nationwide expansion.
3.3. G42 × FPT and Viet Thai Group: Building a Sovereign AI Ecosystem
UAE-based technology group G42 has pursued partnerships in Vietnam to develop AI and cloud infrastructure.
In July 2025, a consortium involving G42, FPT Corporation, VinaCapital, and Viet Thai Group was associated with a proposed hyperscale data center investment of approximately USD 2 billion in Ho Chi Minh City. Subsequently, in February 2026, G42 signed a framework cooperation agreement with a consortium comprising FPT Corporation and Viet Thai Group.
The February agreement announced an investment and consumption commitment of up to USD 1 billion for AI and cloud infrastructure development. The two announcements should be distinguished: the earlier USD 2 billion figure concerned a proposal, while the February 2026 agreement had a different publicly disclosed value and partner composition.
The cooperation is intended to support sovereign AI capabilities, cloud services, and Vietnam's broader digital transformation.
FPT contributes an established Vietnamese technology ecosystem and enterprise market presence, while G42 brings international AI infrastructure and cloud capabilities.
Strategic lesson: For AI-related infrastructure projects, local technology partnerships can provide more than construction support. They may contribute enterprise customers, cloud ecosystems, technical integration capabilities, and market alignment.
3.4. Accelerated Infrastructure Capital × Kinh Bac City: Leveraging Industrial Infrastructure
In March 2026, Accelerated Infrastructure Capital (AIC) signed a memorandum of understanding concerning a proposed AI data center project in Ho Chi Minh City. The development, estimated at approximately USD 2.1 billion, is planned for Tan Phu Trung Industrial Park.
According to Kinh Bac City, the project is intended to be implemented through a joint venture involving AIC, Kinh Bac City Development Holding Corporation (KBC), and international partners. The proposed investment covers data center infrastructure, electrical systems, water supply and drainage, and high-performance GPU computing infrastructure.
At the time of the announcement, the investment registration dossier had been submitted. This case demonstrates the potential advantages of working with an established industrial park developer for projects requiring substantial land, utility infrastructure, and local development coordination.
Strategic lesson: For large AI facilities, an industrial infrastructure partner can play a significant role in site development and coordination of essential utilities. Nevertheless, announced projects still require detailed verification of land rights, grid capacity, financing, and regulatory milestones.
3.5. Samsung C&T × CMC: Integrating Technology and Construction Capabilities
In August 2025, South Korea’s Samsung C&T signed a memorandum of understanding with Vietnamese technology group CMC Corporation to cooperate on the development of CMC’s hyperscale data center project in Ho Chi Minh City.
According to CMC, the first phase is planned for approximately 30 MW, with an estimated investment of USD 250 million.
Later phases could expand the facility beyond 100 MW, bringing total planned investment to approximately USD 1 billion.
Samsung C&T's proposed contribution includes investment and project implementation capabilities, environmentally oriented technologies, and access to international project expertise.
CMC brings its domestic technology ecosystem, data center experience, and understanding of enterprise customers.
Strategic lesson: Partnerships can combine specialized engineering and construction capabilities with a local operator’s technology platform and customer relationships.
This case also illustrates why investors should distinguish a strategic cooperation agreement from a completed equity investment or operational joint venture.
3.6. Comparison of Major Foreign - Vietnamese Partnerships
Foreign investor | Vietnamese partner | Local partner type | Principal contribution and project status |
Sembcorp Development | BB Holding / StarMason | Investment and project-development partner | Local project vehicle; investment approval and SHTP land lease secured |
Evolution Data Centres | HITC | Telecom infrastructure | Existing data center assets, connectivity, local infrastructure; HCMC site lease secured |
G42 | FPT, Viet Thai Group | Technology and diversified business groups | Technology ecosystem, market relationships; framework agreement announced |
Accelerated Infrastructure Capital | Kinh Bac City (KBC) | Industrial park developer | Industrial site development and utility coordination; MoU and investment application announced |
Samsung C&T | CMC Corporation | Technology and data center operator | Existing technology ecosystem and enterprise market knowledge; strategic cooperation MoU signed |
Note: These projects are at different stages of development. Investment approvals, land leases, memoranda of understanding, and framework agreements do not necessarily indicate completed construction, full capital disbursement, or operational readiness.
Collectively, the cases demonstrate that local partnerships can serve several distinct purposes, from site acquisition and infrastructure development to market access and technology integration. They do not establish that a joint venture is legally required or universally superior to wholly foreign-owned investment. Instead, they suggest that successful market entry depends on finding a structure that addresses the particular constraints of each project.
4. Why Foreign Investors Should Consider Local Partnerships
4.1. The Ownership Paradox
Vietnam’s removal of foreign ownership limits has created greater flexibility for international data center investors.
In principle, a foreign company can establish and control its own data center service business without a Vietnamese equity partner. Yet several prominent international investors have chosen partnerships with domestic companies.
The explanation lies in the distinction between legal market access and practical project execution.
Foreign ownership rights determine who can invest and control a business. They do not automatically provide access to a commercially attractive site, sufficient electricity, qualified contractors, regulatory approvals, or customers. A well-selected local partner may help address these challenges, particularly in projects where development timelines and infrastructure availability are critical.
4.2. What a Local Partner Can Bring
Land and site access
Local partners with established industrial or high-tech park operations may help identify suitable land, assess development restrictions, and coordinate site-related procedures. Their contribution is particularly valuable when projects require large sites with expansion potential, proximity to fiber networks, and appropriate infrastructure. However, all land-use rights and project approvals must be independently verified.
Power and infrastructure coordination
Reliable electricity is essential to data center profitability and operational continuity. Partners experienced in industrial infrastructure may assist with electrical capacity assessments, grid connection planning, substation development, and coordination with relevant utilities. They may also support assessment of renewable energy procurement and eligible DPPA structures. However, a partner’s existing business relationships should never be treated as a substitute for documentary confirmation of available power capacity.
Regulatory navigation and compliance
Data center investments involve multiple regulatory systems covering investment, telecommunications, construction, land, environmental protection, and cybersecurity. A qualified local partner may support administrative coordination and help investors understand regulatory practices. All approvals must still be obtained through the applicable legal procedures.
Customer access and market development
Established Vietnamese telecommunications and technology companies may provide access to existing enterprise networks, banking clients, and technology customers. For certain customers, domestic hosting, data governance, operational resilience, and familiarity with Vietnamese requirements may influence procurement decisions. A local partner may therefore accelerate customer acquisition and support the development of a commercially viable demand pipeline.
Local execution capabilities
Data center construction and operations require specialized expertise across electrical engineering, cooling, cybersecurity, construction management, and maintenance. Local partners may help foreign investors identify contractors, recruit qualified personnel, manage procurement, and coordinate daily operations. These capabilities can reduce execution risk when entering an unfamiliar market.
4.3. Choosing the Right Type of Partner
Not every Vietnamese partner provides the same strategic value. Telecommunications operators may be most suitable when connectivity, network infrastructure, operational experience, and existing enterprise customers are important. Technology groups may offer advantages for projects focused on cloud platforms, AI infrastructure, enterprise digital solutions, and integrated technology services. Industrial park and real estate developers may be particularly relevant for greenfield hyperscale projects requiring substantial land, electrical infrastructure, and utility coordination. Financial and investment partners may support capital raising, transaction structuring, corporate development, and investment networks.
The optimal partner should be selected according to the project's primary bottleneck rather than company size or reputation alone. A partner with strong customer relationships may not necessarily have suitable land or confirmed power access. Similarly, a developer with substantial industrial land may lack data center operating expertise. In some cases, a consortium involving multiple complementary partners may be more effective than relying on a single organization.
4.4. Structuring the Partnership
After identifying a potential local partner, investors should evaluate the most appropriate legal and commercial structure. A joint venture may be suitable when both parties contribute substantial long-term assets, capital, or operational capabilities. A business cooperation contract may provide an alternative for particular arrangements where the parties wish to cooperate contractually without establishing a separate joint venture entity.
A phased entry strategy may allow an investor to establish an initial commercial relationship before increasing its capital commitment or acquiring an equity interest, subject to applicable regulations.
Regardless of the structure, investors should clearly define capital contributions, ownership rights, board representation, management authority, and operational responsibilities. Shareholder agreements should address reserved matters, financing obligations, future capital calls, related-party transactions, and approval requirements for major decisions. Exit mechanisms are equally important. Investors should consider share transfer restrictions, buyout rights, valuation mechanisms, deadlock procedures, and dispute resolution provisions, including the potential use of offshore arbitration where legally appropriate. A well-designed structure should align the parties’ long-term incentives while protecting the investor against operational and governance risks.
4.5. Partner Due Diligence: Key Red Flags
Selecting a local partner requires more than assessing its market reputation. Investors should conduct comprehensive legal, financial, commercial, and technical due diligence before signing binding investment agreements. Particular attention should be given to land-use rights, zoning compliance, outstanding disputes, and restrictions affecting the proposed site.
Electricity-related claims should be supported by technical studies, relevant utility correspondence, and evidence of connection feasibility.
Financial diligence should examine debt obligations, contingent liabilities, related-party transactions, beneficial ownership, and the partner's ability to meet future capital commitments.
Commercial diligence should verify claimed customer relationships, letters of intent, pre-lease commitments, and actual contracted demand.
Investors should also assess the partner’s past project execution record, governance practices, management capabilities, and exposure to regulatory or reputational risks. An attractive local partner is one that can demonstrate its contributions through independently verifiable evidence rather than relying primarily on informal assurances.
4.6. How Veridica Can Support Foreign Investors
For international investors entering Vietnam’s data center market, selecting the right local partner is a strategic decision with long-term commercial and operational implications.
Veridica can support the market-entry process through an integrated approach covering partner identification, investment assessment, transaction preparation, and implementation planning.
Partner search and screening
Identify potential Vietnamese partners based on investor requirements, including infrastructure capabilities, financial strength, strategic alignment, and market access.
Due diligence and risk assessment
Support commercial and counterparty assessments, coordinate specialist due diligence where required, and help investors identify potential legal, financial, governance, and execution risks.
Transaction and partnership structuring
Assist investors in evaluating joint venture, acquisition, business cooperation, and phased investment approaches, working alongside qualified legal and financial advisers.
Regulatory and licensing roadmap
Help develop a practical market-entry roadmap covering investment registration, sector-specific requirements, land procedures, and other relevant project approvals.
Post-entry coordination and support
Support investor coordination with local stakeholders, implementation planning, and ongoing partner relationship management.
By combining structured market research with local execution insight, Veridica can help foreign investors move from identifying opportunities to evaluating and developing viable partnerships.
Conclusion: Local Partnerships as a Strategic Advantage
Vietnam’s data center sector offers significant long-term opportunities for international investors.
Growing demand for cloud infrastructure, AI computing, and secure data management is creating opportunities for modern digital infrastructure development.
At the same time, Vietnam’s revised telecommunications framework has made the market more accessible to foreign capital.
However, the experience of recent international entrants demonstrates that regulatory liberalization does not eliminate the practical complexities of developing and operating large-scale infrastructure.
Securing suitable land, reliable power, regulatory approvals, technical expertise, and commercial demand remains fundamental to investment success.
The strongest market-entry strategy is therefore not necessarily the one that maximizes foreign ownership. It is the one that aligns investor control with the local capabilities needed to develop, finance, and operate a commercially sustainable project.
For foreign investors evaluating Vietnam, the right local partnership can be a significant competitive advantage.
Veridica supports international investors in navigating Vietnam’s investment landscape, identifying suitable partners, and developing structured market-entry strategies.
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