Unlocking Opportunities: Data Center Market in Ho Chi Minh City Post-Consolidation

Dr. Dương Văn Thịnh, Chairman of AI & Data Center Club, Vietnam, and VP of AI Technology from VeronLabs

As someone who has dedicated over 15 years to advancing Vietnam's AI and data center infrastructure, I've witnessed an unprecedented transformation in our market landscape. The merger of Ho Chi Minh City has created a unified economic powerhouse that's reshaping Vietnam's data center sector, presenting extraordinary opportunities for savvy investors who understand the market dynamics at play.

Explosive Data Demand Drives Market Evolution

The data demand surge in Ho Chi Minh City post-consolidation represents more than just growth—it's a fundamental shift in how Vietnam approaches digital infrastructure. From my experience working with both domestic and international clients, I observe three critical drivers fueling this expansion. First, Vietnam's National Digital Transformation Programme 2025-2030, which aims to double digital economy growth, has created an insatiable appetite for data processing capabilities. The consolidation has streamlined governance structures, enabling faster deployment of smart city initiatives that require robust data infrastructure. Second, NVIDIA's decision to establish an R&D center in Vietnam specifically for developing AI applications in healthcare, education, transportation, and finance validates the market's potential and signals increasing computational demands. Most significantly, Vietnam's data sovereignty requirements are compelling enterprises to relocate their data infrastructure domestically. This "data onshoring" trend, combined with the consolidated city's improved regulatory framework, has created a perfect storm of demand. In my consultations with multinational corporations, I consistently see requirements for local data residency compliance, driving immediate infrastructure needs. The artificial intelligence boom adds another dimension. Vietnam has rapidly advanced in AI development, ranking among ASEAN's leaders in readiness, trust, and adoption, requiring specialized high-performance computing facilities that traditional data centers cannot accommodate.

Market Forecast

Unprecedented Growth Through 2030 Based on my analysis of current trends and infrastructure developments, I project Ho Chi Minh City's data center market will achieve a compound annual growth rate of 16-19% through 2030, significantly outpacing national averages. Viettel's inauguration of its largest AI facility in Ho Chi Minh City in April 2025 exemplifies the scale of investments flowing into the market. The consolidation has eliminated regulatory fragmentation, creating a unified market that can support hyperscale deployments. I forecast the market will reach 850-1,000 MW of total capacity by 2030, with AI-optimized facilities comprising 35-40% of new deployments. Edge computing infrastructure will experience even more dramatic growth, expanding from virtually zero to 150-200 edge nodes as 5G networks mature. Revenue projections are equally compelling.

My models suggest the market will reach $1.2-1.5 billion by 2030, driven primarily by colocation services, cloud connectivity, and specialized AI training facilities. The consolidation has created economies of scale that make Vietnam cost-competitive with established regional hubs while offering superior growth prospects.

Strategic Investment Opportunities for Foreign Capital

Foreign investors face a unique window of opportunity in Ho Chi Minh City's consolidated market. My experience facilitating international partnerships reveals three high-potential segments: Hyperscale facilities targeting cloud service providers represent the highest-value opportunity. The consolidated market provides sufficient scale to justify investments exceeding $200-300 million, with projected IRRs of 12-15% over 10-year periods. The partnership between Sovico Group and Supermicro for AI data center development demonstrates growing international appetite for such investments. AI-optimized infrastructure presents premium returns for technically sophisticated investors. These facilities command 40-50% higher lease rates than traditional data centers while serving rapidly expanding demand from AI companies and research institutions. Edge computing deployments offer scalable entry points for smaller investors. With 5G rollout accelerating post-consolidation, micro data centers supporting low-latency applications will proliferate throughout the metropolitan area.

Government Policies

A Framework for Success Vietnam's strategy to position itself as a leading AI innovation hub in ASEAN by 2030 has produced remarkably investor-friendly policies. The consolidated municipal government offers streamlined approval processes, with data center projects receiving priority status for permitting and land allocation. Tax incentives are substantial: qualified data center investments receive corporate income tax rates of 10-15% for the first 15 years, compared to the standard 20% rate. Import duty exemptions apply to high-tech equipment, reducing initial capital requirements by 8-12%. Land lease terms extend up to 50 years with renewal options, providing long-term investment security. Most importantly, the government recognizes foreign expertise as essential for developing world-class infrastructure. Joint venture requirements have been relaxed for data center investments exceeding $50 million, allowing majority foreign ownership in strategic projects.

Strategic Outlook

Ho Chi Minh City's post-consolidation data center market represents a generational opportunity. The confluence of strong domestic demand, supportive government policies, and improved regulatory efficiency creates conditions rarely seen in emerging markets. However, success requires deep market understanding and local partnerships. The most successful foreign investors will be those who combine international best practices with local market intelligence, building sustainable competitive advantages in Vietnam's digital transformation journey. The opportunity is real, substantial, and time-sensitive. Those who act decisively will secure dominant positions in what promises to become Southeast Asia's next great data center hub.