An alluring destination for investment in technology

In Vietnam, policy initiatives are aimed at accelerating development of the technology sector.

- By Tran Nguyen Tam Huong

The government has been proactive to attract both domestic and foreign investors, through both enhanced investment incentives and regulatory reforms. We look at key incentives.

The Law on the Digital Technology Industry, made effective in January, marked a significant milestone. The law establishes a unified legal framework that governs semiconductors, AI, digital infrastructure, data centres, and digital assets.

The change provides greater regulatory certainty for investors. Previously, technology projects were often subject to fragmented regulations administered by multiple ministries and authorities. The new law consolidates regulatory oversight, streamlines the compliance process, and introduces a clearer and more predictable system of investment incentives and support mechanisms.

In addition, the government has created a list of key digital technology products and services eligible for investment incentives. Investors engaged in the research, development, production, or provision of these prioritised products and services may qualify for incentives.

The Law on Artificial Intelligence, which came into effect in March, complements these developments by introducing a risk-based governance framework for AI systems. The law establishes a structured regulatory sandbox that allows technology companies to test and deploy AI products. This is a positive signal for serious institutional investors. It signals Vietnam’s intent to build a transparent, rules-based ecosystem to attract and retain high-quality, long-term investment in the technology sector.

The latest Law on Investment, also introduced in March, introduces a dedicated framework for special investment incentives, support measures, and preferential tax treatment.

In parallel, the government has established an investment support fund aimed to attract strategic investors and multinational corporations operating in priority sectors.