While all public attention and scrutiny are focused on U.S. President Donald Trump’s visit to China, a neighboring country – Vietnam – is quietly undergoing reforms and emerging as an attractive destination for investors in the period between 2026 and 2035.
Vietnam’s strategic location and advantages for trade partners
Located along important regional shipping routes such as the East-West axis connecting trade from the Americas to the Middle East, India, and Europe, as well as the North-South axis connecting China and Southeast Asian countries, Vietnam is considered a gateway for international import and export trade. Vietnam has approximately 3,200 kilometers of coastline, with 114 seaports (as of January 2022), including many deep-water ports along the coast.
These advantages become even stronger when considering Vietnam as a destination in the “China + 1” strategy. As a “China + 1” option, Vietnam’s proximity to China, both by land and sea, has positioned it as a preferred alternative for manufacturing operations for many companies. For example, cities like Hai Phong are only 865 kilometers from China’s manufacturing hub, Shenzhen. By locating manufacturing centers near traditional hubs in China, manufacturers have been able to reduce costs and avoid disruptions or delays to existing supply chains.
Integration into China’s supply chains for foreign-invested companies is further facilitated by the fact that many factories in Vietnam are owned by Chinese, Taiwanese, and Korean companies, countries that have established robust trade routes and conditions. The transfer of existing checklists, specifications, or product information from those regions has, in many cases, been pioneered.
Key Facts about Vietnam
Below are some facts and figures about Vietnam:
Vietnam’s economy has proven ideal for foreign investment and business interest
Despite global challenges and the impact of natural disasters in 2025, the Vietnamese economy has demonstrated strong resilience, recording GDP growth of 8.02% in 2025 and further reinforcing economists’ optimistic outlook.
Against this backdrop, specific trends are also driving further increases in foreign investment in Vietnam, making the country an attractive destination for companies worldwide seeking to:
- Diversify their presence in Asia
- Access the Vietnamese and South Asian markets
- Supplement business operations in China
- Leverage attractive free trade agreements, manufacturing advantages, and market opportunities
A recent key driver is the development in the U.S.-Vietnam trade relationship, particularly reflected in the latest U.S. tariff updates and trade policy adjustments. With the U.S. imposing higher tariffs and trade restrictions on certain products originating from China, many companies are turning to Vietnam to avoid these barriers, benefiting from Vietnam’s preferential trade agreements with the U.S., such as the Bilateral Trade Agreement and commitments under the U.S. Generalized System of Preferences (GSP).
Businesses view Vietnam on the same level as China as a manufacturing partner
Many businesses are now viewing Vietnam as a safer or secondary investment option in Asia for downstream manufacturing, assembly, and services, rather than relying solely on China.
Recent global supply chain disruptions, border closures, lockdowns, and rising labor costs in China have further enhanced Vietnam’s competitiveness, supported by tariff considerations, to attract more foreign direct investment. Vietnam is entering a pivotal phase in its development, pursuing ambitious growth targets while restructuring the regional economy. The government is prioritizing high-value growth through policies that boost productivity, foster innovation, and accelerate industrial upgrading.
Vietnam is investing in the future, helping boost manufacturer confidence
Globally, 2026 is predicted to continue to be a year of high geopolitical risk and policy uncertainty. The Economist Intelligence Unit (EIU) forecasts global growth to slow to 2.4% in 2026, while the World Trade Organization (WTO) predicts that the impact of U.S. tariffs on international trade will become more pronounced during this period.
For Vietnam, 2026 holds special significance as it marks the beginning of the final phase of the 10-year Socio-Economic Development Strategy (2021-2030). This year is expected to provide momentum for the final efforts towards national growth targets, with a focus on high-quality growth, digital transformation, and sustainable development.
Under the updated national planning framework, Vietnam is prioritizing the development of strategic and high-tech industries, including electronics, digital technology, automotive manufacturing, railways, and shipbuilding. The country also intends to gradually build capacity in next-generation fields such as semiconductors, robotics, automation, and artificial intelligence. By 2030, Vietnam aims to become the second-largest e-commerce market in Southeast Asia, further strengthening its transition to a knowledge-based and innovative economy.
Why Vietnam is Favored by Many for Investment in Manufacturing and Trade
Below are five reasons why Vietnam is a noteworthy investment destination in the period between 2026 and 2035.
1. Strategic Location: Strategic destination for manufacturing and China +1, located along shipping and transport routes, bordering South China, and centered along East Asia.
2. Growing Economy: Strong economic GDP growth including continuing annual GDP growth, consistently competing with its global and regional peers.
3. Stable Government: Relatively stable government with a solid economic vision, fair policy control, low investment barriers, and strong incentives schemes relative to similar markets.
4. Strong Growth Engines: Vietnam has set ambitious targets to sustain growth through 2030, aiming for over 8 percent average annual GDP growth, at least 10 percent annual between 2026 and 2030, and per capita income of about $8,500 by 2030, rising to roughly $38,000 by 2050. It also has a large, young labor force of nearly 60 million workers, growing by 1 million more workers per year.
5. Network of FTAs & Integration with Legal Framework: Vietnam is a signatory of more than 17 Free Trade Agreements, giving trade advantages through countries in APAC, ASEAN, Europe, and elsewhere globally. Vietnam is also a WTO member and has 100% compliance on major worldwide Intellectual Property Protection conventions, protocols, and agreements.
