Construction industry in Vietnam - statistics & facts

Vietnam’s construction industry has been the best performing in the Asia Pacific region, having had the highest revenue growth rate in recent years. As an important pillar of the Vietnamese economy, the construction sector accounted for an increasing contribution to the gross domestic product while being one of the largest employers in Vietnam. At the same time, it has been among the industries that attracted the most foreign direct investment (FDI) in the past years. Despite the impact of the COVID-19 pandemic, this sector is forecast to continue growing alongside Vietnam’s rapid economic expansion.

Industrial construction growth alongside Vietnam’s blooming manufacturing sector

Manufacturing has become the backbone of Vietnam’s export-oriented economy in the past decade. This development of the manufacturing sector has come with the need for more production facilities, and consequently, constant growth in industrial construction projects and investments. In the first eight months of 2021, there were over 1150 industrial construction projects in all implementation stages in Vietnam, which were responsible for a total investment value of over 87 billion U.S. dollars. While domestic direct investments, including state investments, have been instrumental to these projects, FDIs have been playing an increasingly significant role in industrial constructions, together with foreign investment flows into manufacturing. FDI in the construction sector was highest in northern Vietnam, with a focus on production facilities for crucial export products such as electronics, electrical equipment, and textiles. Domestic investments, meanwhile, were the most dominant sources of investment in other regions in Vietnam, where projects aiming at both external and domestic consumption, namely energy, pharmaceuticals, and agriculture received the most attention.

COVID-19 impacts and the outlook of the construction sector in Vietnam

Similar to other industries, the Vietnamese construction sector has not been spared by the COVID-19 pandemic. The government imposed several strict lockdowns across the country during COVID-19 outbreaks, resulting in the delays of many projects due to the unavailability of workers and construction materials. Despite losing momentum to the pandemic, this industry in Vietnam is predicted to continue to grow steadily in years to come. The growth of this sector can largely be attributed to the government’s commitment to improving the overall infrastructure in the country. This includes ongoing investments in non-residential segments, such as national strategic projects in transport infrastructure or tourism infrastructure. In addition, Vietnam’s high urbanization rate is forecast to create rising demand for residential projects, especially for affordable housing supply.


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