Vietnam has emerged as a top investment destination in Southeast Asia, offering vast business opportunities across multiple industries. However, foreign investors often face challenges such as language barriers, regulatory complexities, and finding reliable partners. This guide explores Vietnam’s economic landscape, common obstacles, and how business matching services can help streamline partnerships, reduce risks, and ensure successful market entry.

Overview of Vietnam’s economy and foreign investment situation

Vietnam offers a promising destination for foreign expansion with its stable and fast-growing economy. After a trough during the COVID-19 pandemic, Vietnam’s economy quickly rebounded, with a peak GDP growth rate of 8.02% in 2022, the highest since 2011. The country maintained a respectable growth rate of 5.5% in 2023 and 7.09% in 2024, and its 476-billion-USD GDP is forecasted to grow by 6.1% in 2025, the highest in the Southeast Asia region[1]. The Vietnamese government has also actively improved business incentives for foreign investors, especially in high-tech industries, notable of which is the 5% applicable tax rate for 37 years for qualified R&D and high-tech projects under Decision No. 29/2021/QD-TTg signed in 2021[2].

With its favorable economic landscape, the country has become a crucial hub for international trade and investment. In 2024, the FDI sector recorded a total registered capital of 38.23 billion USD, mainly in the processing and manufacturing sector. While total registered capital saw a slight year-over-year decrease of 3%, FDI disbursement in 2024 increased by 9.4% from 2023 to a record 25.23 billion USD, highlighting Vietnam’s attractiveness and potential for foreign investors.

Foreign Direct Investment Registered in Vietnam from 2020 to 2024

Unit: %

Source: GSO

According to B&Company Vietnam’s Enterprise Database, Vietnam had a total of 1.08 million active companies in 2023, with around 20,000 foreign investment enterprises and joint ventures, generating 28% of the total net revenue. South Korea led with nearly 5,500 companies, followed by Japan and China. These companies are highly concentrated in the Southeast and Red River Delta regions of Vietnam, especially in Ho Chi Minh City (31%), Ha Noi (15%), and Binh Duong (12%).

FDI companies in Vietnam by country of investment in 2023

Unit: %

Source: B&Company Vietnam’s Enterprise Database

Business Matching with Vietnamese companies

The business matching process with Vietnamese companies is a strategic approach that connects foreign companies with suitable local partners, ensuring successful market entry and collaboration. This process involves identifying potential partners, evaluating their credibility, facilitating direct meetings, and maintaining follow-up communications to build long-term relationships. While Vietnam presents many opportunities, foreign companies may encounter a number of obstacles when seeking business partnerships with local companies. Some of the most common challenges include:

(1) Lack of an Industry-specific Database can be a hindrance for foreign investors, requiring them to rely on online search to find potential partners, which can be inefficient.

(2) Limited Transparency and Information make it difficult for foreign investors to assess a potential partner’s credibility and capability, as many Vietnamese companies lack publicly available financial records, verifiable business data, or an online presence.

(3) No appropriate point of contact may cause difficulties for foreign investors, as normal published information may only lead to the sales team. Without the decision makers’ contact, communication is potentially delayed or neglected due to language barriers, resulting in a time-consuming process and missed business opportunities.

(4) Limited Foreign Language Proficiency can be a major barrier in communication with a Vietnamese partner. While education of foreign languages is improving, Vietnam was still categorized as “Low Efficiency” in English usage, according to the EF English Proficiency Index in 2024[3].

(5) Cultural Barriers in negotiation styles, decision-making processes, and business etiquette can also lead to misunderstandings and potential conflicts.

Business Matching process and potential challenges for foreign investors

Source: B&Company Vietnam

Business Matching Services

To overcome challenges and establish successful partnerships, foreign investors can leverage business matching services, which act as a bridge between international businesses and Vietnamese companies. These services help identify suitable partners by conducting secondary research based on specific requirements such as location, manufacturing capacity, distribution networks, and language capabilities. After client revisions, business support activities like meeting arrangements and factory visits facilitate direct engagement.

Business matching providers play a crucial role throughout the process by:

– Offering tailored partner recommendations through industry database instead of relying on generic business directories;

– Streamlining partner sourcing, reducing the time and resources needed for evaluation and negotiation;

– Conducting market analysis and assisting with due diligence;

– Supporting in networking events, trade missions, and B2B meetings to foster engagement;

– Providing translation and cultural mediation to ease communication.

By leveraging these services, foreign investors can navigate Vietnam’s business landscape efficiently and secure reliable partnerships.

Business Matching Service at B&Company Vietnam

Source: B&Company Vietnam

Foreign investors looking to leverage business matching services should consider the following factors when selecting a provider:

– Industry Expertise: Choose a service provider with in-depth knowledge of your industry and experience in the Vietnamese market.

– Proven Track Record: Review success stories, client testimonials, and case studies to assess the provider’s credibility.

– Extensive Network: Opt for a provider with a strong network of reliable local businesses, trade associations, and government agencies.

– Comprehensive Support: Select a service that offers end-to-end support, including partner identification, legal assistance, and post-matching advisory.

– Customization: Ensure the provider tailors its services to align with your specific business needs and objectives.

Conclusion

Vietnam offers immense potential for foreign investors, but successfully entering the market requires overcoming various challenges. Business matching services play a crucial role in connecting international companies with reliable Vietnamese partners while providing essential market insights, legal support, and networking opportunities. By leveraging these services, foreign investors can mitigate risks, improve efficiency, and establish strong, successful business relationships in Vietnam.

[1] IMF. IMF Datamappper – Vietnam <Assess>

[2] Vietnam Government Portal. Decision No. 29/2021/QD-TTg prescribing special investment incentives <Assess>

[3] EF Education First. EF English Proficiency Index 2024 <Assess>