Infrastructure and housing investment should sustain momentum in construction
The economic growth is very positive with GDP rising 6.2 percent in 2017 and forecast in 2018 to expand by 6.6 percent. The main drivers are surging foreign direct investment and expanding exports. Vietnam remains attractive for foreign investors and new foreign direct investment increased year-on-year by 77.6 percent.
The economy also benefits from a young population mostly of work age. Unemployment is low and domestic demand strong.
Construction has performed strongly and the momentum is forecast to be sustained through to 2021 by economic recovery and government infrastructure and housing investment. Significant population growth adds to the urgency.
Rapid rail, airports and roads are on the government priority list. Major projects in Ho Chi Minh City alone include the USD1bn Thu Thiem Smart City, USD800m of investment in metro lines, the planned USD16bn Long Thanh International Airport and an extension to Tan Son Nhat International Airport. There is also the PPP funded 654km North-South Expressway project, expected to cost USD5.23bn between 2017 and 2020.
|Cost escalation 2017–18:||2.0%|
|Cost escalation 2018–19:||3.0%|
|Location factor (USD):||39.7|
The future of Vietnam is bright. With its rapid-growing economy, it has attracted ever more investment. However, it struggles with poor infrastructure. To meet the demands of increased urbanization and a growing population, a robust infrastructure development plan is underway, providing huge scope for the construction industry.
This content is part of the International construction market survey 2018