The government is now operating in accordance with the Guidance on Caretaker Conventions, pending the outcome of the 2025 federal election.
Vietnam’s continued urbanisation is expected to increase the burden on major cities to provide services and achieve liveability outcomes. The nation faces significant risks from natural disasters, heightening the need to enhance the resilience and preparedness of its cities and towns.
The Vietnamese Government is looking to implement appropriate smart cities solutions and services, creating opportunities for Australian companies in the following areas.
AI-powered cities and digital innovation
This year at the World Economic Forum in Switzerland, Ho Chi Minh City and CMC Corporation announced an ambitious initiative to establish the world’s first AI-powered city. (Vietnam+, Vietnamese initiative aims to establish world’s first AI city, 23 January 2025.)
The Vietnamese digital economy’s gross merchandise value increased by 16% last year, reaching A$56.9 billion with investments in fintech, AI and cyber security. (Google, Bain & Co, Temasek, e-Conomy SEA 2024 report, November 2024.)
Ho Chi Minh City and Da Nang are integrating AI for governance, transport and citizen services. The Government is pushing 5G deployment and cloud computing, accelerating the adoption of AI-driven urban solutions.
Water and waste management opportunities
Water infrastructure will be an important focus area given economic growth and climate change trends. Vietnam’s water demand will increase by 32% by 2030, requiring around US$9 billion worth of infrastructure investment for water treatment and drainage. (Investment and Trade Promotion Centre, Vietnam needs $9B worth of water infrastructure investment: World Bank, last accessed 31 March 2025.)
Vietnam plans to invest in water infrastructure, including smart water metering, digital leak detection, and advanced waste treatment systems. Currently, 85% of waste is landfilled without treatment, presenting a major opportunity for circular economy solutions and waste-to-energy initiatives.
Carbon market and green financing
Vietnam’s pilot carbon market (2025–2028) will be officially launched in 2029, creating demand for carbon credit solutions, green financing, and ESG-compliant projects.
The Just Energy Transition Partnership, a A$22.05 billion initiative, will drive clean energy investment. Key investment projects include:
- promoting the conversion of coal power to clean energy
- developing ecosystems for renewable energy in industrial and service sectors
- optimising energy usage
- upgrading power transmission and distribution systems
- advancing smart power grids and energy storage systems
- transforming the transportation industry to reduce greenhouse gas emissions.
Vietnam is looking for a range of solutions – from AI to smart metering and e-governance – to build smart cities.
The rise of technology and digital services
Many of the Vietnamese Government’s IT investment drivers are solutions for smart governance. In the United Nations E-Government Survey 2022, Vietnam ranked 71st out of 193 countries. (UNDESA, UN e-Government Survey 2024, September 2024.)
The government’s National Digital Transformation Program aims for 80% of public services to be online by 2030. Investment in e-governance, fintech, smart security and cloud computing is rising, with smart city solutions becoming a key focus.
Public-Private Partnerships (PPP) driving growth
Vietnam’s Law on Public-Private Partnership enhances transparency and investor confidence, unlocking opportunities in infrastructure, transport and smart utilities. Investors can engage in long-term projects with clearer legal frameworks and risk-sharing models.
This is the second article in a two-part series on smart cities opportunities in Vietnam. Read the first article here.
Vietnam Smart Cities in-market Immersion program
The Vietnam Smart Cities In-market Immersion 2025 is taking place from 7–9 May in Ho Chi Minh City – the economic heart and southern hub of Vietnam.
Join this mission where company founders and representatives can elevate their market strategies, directly engage with industry leaders, and forge valuable connections. Be part of the Smart City Asia 2025 Exhibition and Forum, one of the largest smart city tech events in Vietnam.
As part of Team Australia at the Austrade Pavilion, you’ll have opportunities to connect with potential customers, participate in high-impact forums, and engage in one-on-one business-matching sessions.
Unlock your opportunity to dive into Vietnam’s thriving transformation. Register your interest in the program before 18 April, or contact Trang Vũ, Landing Pad Manager, for more information.
Sign up to receive the latest news and insights about Southeast Asia.
Go further, faster with Austrade
Austrade’s Go Global Toolkit helps you learn the export basics, find the right markets and understand market requirements.