Vietnam Artificial Intelligence Market Outlook to 2030

Vietnam Artificial Intelligence Market Overview

• Vietnam Artificial Intelligence (AI) market was valued at USD 554 million in 2023. This growth was driven by increasing digitalization across various sectors, a growing emphasis on technological advancement by businesses, and supportive government policies aimed at fostering innovation and AI adoption.
• Key players in the Vietnam AI market include FPT Corporation, Viettel Group, VNPT, Vingroup, and Techcombank. These companies are leading the AI adoption by integrating AI into their operations and offering AI-based solutions and services. FPT Corporation, for example, has developed AI-powered platforms for various applications, while Viettel Group focuses on AI for telecommunications and security solutions.
• In 2024, FPT and its subsidiaries kicked off construction on a $174 million AI project in south-central Vietnam. The project covers an area of 93.24 hectares and includes an AI center, an education zone, and a supporting urban zone. The AI center will focus on research, software production, digital transformation assistance, and cybersecurity solution provision.
• Hanoi and Ho Chi Minh City dominate the Vietnam AI market due to their role as economic and technological hubs. Hanoi, being the capital, hosts numerous government agencies, research institutions, and tech companies that drive AI research and development. Ho Chi Minh City, as the commercial center of Vietnam, has a vibrant startup ecosystem and is home to several tech parks and innovation centers, attracting both local and international tech companies.

Vietnam Artificial Intelligence Market Segmentation

The Vietnam Artificial Intelligence Market can be segmented based on several factors:

By Application: Vietnam AI market is segmented by application into healthcare, finance, retail, and manufacturing. In 2023, the healthcare segment dominated this market due to the increasing use of AI in diagnostic tools, personalized medicine, and predictive analytics. The growing demand for enhanced patient care and the adoption of AI for medical imaging and electronic health records contributed to the dominance of this segment.

By Technology: Vietnam AI market is segmented by technology into machine learning, natural language processing (NLP), and computer vision. In 2023, machine learning dominated this segment due to its wide range of applications across various industries, such as fraud detection in finance, customer service automation in retail, and predictive maintenance in manufacturing. The ability of machine learning to improve decision-making and operational efficiency has driven its widespread adoption.

By Region: Vietnam AI market is segmented by region into North, South, East, and West. In 2023, the Northern region, which includes Hanoi, dominated this segment. The concentration of government agencies, research institutions, and tech companies in Hanoi has created a strong ecosystem for AI research and development. The presence of several universities and tech parks also contributes to the region's leadership in the AI market.

Vietnam Artificial Intelligence Market Competitive Landscape

• Viettel Group: In 2024, Viettel opened the largest data center in Vietnam, located in Hoa Lac Hi-tech Park, Hanoi. This facility is designed to support AI development, featuring a maximum capacity of 30 MW and accommodating over 60,000 servers. Viettel plans to expand this data center's capacity to 17,000 racks by 2025 and 34,000 racks by 2030.
• FPT Corporation: In 2023, FPT Software and Landing AI, a US-based AI company, have announced a strategic partnership to advance AI development and education in Vietnam. The collaboration aims to explore the potential of opening a dedicated engineering center in Vietnam to develop a high-quality workforce in AI. This partnership marks an important step forward in the collaboration between Vietnam and the United States in the field of AI.

Vietnam Artificial Intelligence Industry Analysis

Growth Drivers:

• Increase in AI Investment and Funding: From 2021 to 2024, Vietnam experienced a significant increase in AI-focused investments and funding, particularly from international venture capital firms. In 2021, the total value of investments in AI ventures in Vietnam reached approximately $24 million, distributed across various sectors. This marked a significant increase compared to previous years. This influx of capital is primarily due to the governments favorable policies and the growing recognition of Vietnam as an emerging tech hub in Southeast Asia.
• Adoption of AI in the Public Sector: Vietnamese government has been proactively integrating AI technologies into various public sector services. In 2021, the Vietnamese government launched the National Strategy for Research, Development, and Application of Artificial Intelligence until 2030. This strategy aims to position Vietnam among the top four nations in ASEAN and within the top 50 globally for AI research and application.
• Rapid Digital Transformation in Enterprises: Between 2021 and 2024, Vietnamese enterprises across sectors such as banking, retail, and manufacturing have significantly accelerated their digital transformation efforts, with AI being a core component. The Vietnamese government aims to develop 48,000 digital technology enterprises across localities by 2024, indicating a strong push towards establishing a robust digital ecosystem.

Market Challenges:

• Data Privacy and Security Concerns: With the increasing adoption of AI technologies, data privacy and security have emerged as critical concerns in Vietnam. There were cases of data breaches involving AI systems, leading to significant financial losses and undermining public trust. The Vietnamese government has enacted stricter data protection laws, but the rapid pace of AI deployment often outstrips the regulatory frameworks ability to ensure compliance and protect sensitive information.
• High Cost of AI Implementation: The initial cost of deploying AI technologies remains a barrier for many small and medium-sized enterprises (SMEs) in Vietnam. As of 2024, it is estimated that the average cost of implementing an AI solution can range from USD 50,000 to USD 200,000, depending on the complexity and scale of the project. These high costs are a deterrent for SMEs, which constitute a significant portion of the Vietnamese economy, limiting their ability to adopt AI and leverage its benefits.

Government Initiatives:

• "AI in Industry 4.0" Initiative: "Build for the AI Future" initiative in Vietnam was officially launched on July 11, 2024. This initiative, a collaboration between the National Innovation Centre (NIC) and Google, aims to accelerate Vietnam's advancement in artificial intelligence by focusing on talent development and support for startups. Additionally, the establishment of the RMIT & Ericsson Artificial Intelligence Lab in Hanoi was announced in August 2023, further emphasizing Vietnam's commitment to integrating AI into its Industry 4.0 strategy.
• STEAM Education Promotion: STEAM Education Program in Vietnam has gained significant attention and development in recent years, particularly around 2019 and 2021. Programs like TEKY are implementing modern STEAM curricula across Vietnam, focusing on subjects such as coding, robotics, and multimedia. TEKY operates 21 centers and aims to enhance the skills of thousands of students, particularly targeting underrepresented groups, including girls.

Vietnam Artificial Intelligence Future Market Outlook

By 2028, the Vietnam Artificial Intelligence market is expected to continue its rapid growth, driven by several key factors. The increasing adoption of AI across various sectors, including manufacturing, healthcare, finance, and public services, will be a significant driver.

Future Trends

• Expansion of AI in Smart Cities: Vietnam is expected to see substantial growth in the use of AI technologies for smart city development. With government support, cities like Hanoi and Ho Chi Minh City will continue to implement AI-driven solutions for traffic management, public safety, and energy efficiency. These initiatives will not only improve urban living conditions but also drive economic growth by attracting investments and fostering innovation.
• Growth in AI-Powered Healthcare Solutions: The healthcare sector in Vietnam is poised to witness significant advancements in AI applications by 2028. AI-powered diagnostic tools, telemedicine platforms, and personalized healthcare solutions will become more prevalent, improving access to quality healthcare services, especially in rural and underserved areas. The integration of AI in healthcare will also enhance patient outcomes, reduce costs, and optimize resource utilization.