Amid a profound restructuring of the global technological landscape and the deep shift of supply chains toward Southeast Asia, Vietnam is rapidly evolving from a “factory” that merely undertakes labor-intensive industries into a battleground for the digital economy and cutting-edge artificial intelligence technologies.
Author | Leci Zhang
Editor | Yiran Xing
On March 1, 2026, Vietnam’s Law on Artificial Intelligence (Law No. 134/2025/QH15) officially came into effect, marking Vietnam as one of the few countries in Southeast Asia and globally to adopt dedicated and systematic AI legislation at the national parliamentary level.
For Chinese technology and AI enterprises that are seeking new growth curves and actively advancing their globalization strategies, this represents an important signal that cannot be ignored.
In recent years, the logic of Chinese technology enterprises expanding into Vietnam has primarily revolved around smartphone hardware sales, the penetration of basic internet applications, and the horizontal relocation of manufacturing capacity. However, with the rapid expansion of Vietnam’s domestic AI market, purely “technology dumping” and “capacity export” can no longer meet its national strategic demands. Data show that by 2030, Vietnam’s AI market size is expected to exceed USD 2 billion, with a compound annual growth rate as high as 15%.
At the same time, the Vietnamese government has clearly designated artificial intelligence as a core driver of national growth, innovation, and sustainable development, and has established a non-profit national AI development fund to build a digital ecosystem with a strong sense of sovereignty.
At present, Chinese enterprises going global are facing a critical transition from “product export” to “deep cultivation of computing power,” “co-construction of large model ecosystems,” and “export of industrial intelligence standards.” Against this backdrop, this article will analyze the governance logic of Vietnam’s new AI policies and project the strategic positioning and competitive moats for Chinese enterprises in key areas such as computing infrastructure, localization of open-source large models, intelligent manufacturing, and smart cities.
Vietnam’s AI Regulation: Governance Logic of Risk Orientation and Digital Sovereignty
To accurately assess the commercial opportunities of expanding into Vietnam, it is first necessary to examine the legislative logic of the Law on Artificial Intelligence, which attracted global attention from the technology community in March 2026. The entry into force of this law marks Vietnam’s comprehensive repeal of the preliminary and fragmented provisions on AI contained in the Digital Technology Industry Law (DTI Law), which took effect on January 1, 2026, and the establishment of a unified, human-centered specialized regulatory framework. At its core, the law seeks to seize discourse power in shaping artificial intelligence rules within the ASEAN region through clear institutional design, while preventing the ethical and security risks posed by generative AI.
Vietnam’s AI legislation clearly draws on the European Union’s AI Act, adopting an extremely stringent, risk-based classification and management model. The establishment of this regulatory paradigm requires Chinese enterprises preparing to enter or already deeply engaged in the Vietnamese market to completely abandon the inertia of the early domestic internet era mindset of “growth first, compliance later,” and instead move compliance review and risk assessment upstream to the stages of algorithm design and training data selection for AI products.
Among the aforementioned classifications, the regulatory provisions governing high-risk systems have the most far-reaching impact on the overseas expansion strategies of Chinese enterprises. At present, Vietnam’s Ministry of Science and Technology (MoST) is drafting an official List of High-Risk AI Systems, to be promulgated by the Prime Minister.
The evaluation criteria for this list cover five dimensions: impact on human rights and legitimate interests, impact on safety and public welfare, sensitivity of use scenarios, degree of automation and scope of human control, as well as scale of application and potential consequences.
The law’s mandatory localization requirements for high-risk systems mean that Chinese enterprises can no longer simply deploy cross-border cloud servers in Singapore to deliver core AI decision-making capabilities to Vietnam. If financial or medical AI is involved, Chinese enterprises must enter the Vietnamese market locally by establishing wholly owned subsidiaries, joint ventures, or employing local executives as legal representatives to meet market entry thresholds.
While this raises legal and operational costs for market entry in the short term, it objectively clears out low-end arbitrage players and significantly raises competitive barriers for Chinese enterprises willing to make long-term, asset-heavy investments and deeply integrate into Vietnam’s local interest networks.
In addition, the law imposes nearly stringent enforcement standards on algorithm transparency and the labeling of AI-generated content. From March 1, 2026 onward, all AI systems that directly interact with humans must be clearly and unmistakably identified as artificial intelligence; audio, images, or videos generated by AI must embed machine-readable markers at the underlying level; and any deepfake content that may mislead the public regarding real events, appearances, or voices must display clear and visible labels on the front end for user differentiation.
This requirement imposes direct underlying technical transformation demands on Chinese enterprises engaged in overseas short-video platforms, social media entertainment, virtual digital humans, and cross-border digital marketing. If enterprises fail to establish effective watermark injection and content traceability mechanisms, they will face the risk of being reported or even forcibly blocked on Vietnam’s national-level “AI Single-window Portal” (the AI Single-window Portal serves as a national-level compliance gateway for AI in Vietnam, where overseas enterprises must complete registration and provide traceable identification).
However, Vietnam’s policymakers are not solely focused on strict control. From the outset, the law has fully incorporated innovation incentive mechanisms: to attract cutting-edge global technologies and capital, the law introduces a national AI development fund and explicitly establishes regulatory sandboxes for startups and small and medium-sized enterprises. Within these sandboxes, enterprises can benefit from simplified administrative approval procedures and test advanced AI technologies in controlled real-world environments without bearing full liability for potential violations.
More importantly, the law provides a valuable grace period for existing AI systems already operating in the Vietnamese market: systems in general domains are granted a 12-month transition period (until March 1, 2027), while systems in high-risk sectors such as healthcare, education, and finance are granted up to an 18-month compliance rectification period (until September 1, 2027). This buffer period represents a golden window for Chinese AI enterprises to audit algorithmic risks, reconstruct data compliance chains, and seize market share.
The Awakening of Demand: A Market with Ultra-High Adoption Rates and a Strong Appetite for Commercial Value
To understand the opportunities for Chinese AI enterprises in Vietnam, it is necessary to move beyond the macro policy framework and gain a deeper insight into the real demand structure of the local Vietnamese market.
For a long time, the outside world’s stereotype of Vietnam has remained that of a “labor-intensive processing factory,” but Vietnamese society’s current embrace of digital technology is already striking.
According to the 2025 Global AI Index released by WIN, the international independent market research network, Vietnam ranked sixth among 40 surveyed countries; even more strikingly, the Vietnamese public ranked third globally in trust in AI (65.6 points) and fifth globally in AI acceptance (71.6 points).
This society’s extreme openness and tolerance toward emerging technologies provides exceptionally fertile ground for the rapid diffusion of AI products.
On the consumer side, Vietnam’s online population is demonstrating astonishing AI stickiness. Surveys show that as many as 78% of Vietnamese internet users have used at least one AI platform in the past three months, with Generation Z occupying an absolutely dominant position in high-frequency daily interactions.
In the first half of 2025, Vietnamese users spent nearly 300 million hours on generative AI applications, averaging as high as 1.6 million hours per day, representing an almost eightfold increase compared with the same period in 2024.
Among developers and professional groups, AI penetration is even more profound: 94.3% of Vietnamese engineers use AI to assist with coding, 70% use it to write technical documentation, and 62.9% apply it to code testing, with this proportion ranking first across Southeast Asia.
At the same time, the market’s evolution is moving beyond the trial stage. Nguyen Van Khoa, Chief Executive Officer of FPT Group, pointed out that if 2023 was the “year of proof of concept” for AI in Vietnam, then 2025 and 2026 have officially become the “year of commercial value.”
The current pain point in the Vietnamese market is that although ordinary users and young developers at the grassroots level are enthusiastic about international tools such as ChatGPT and Gemini, at the enterprise level only 36.5% of companies have a clearly documented AI strategic plan, while as many as 46.4% of enterprises are struggling with a severe shortage of in-house AI talent.
This huge gap between “extremely high social acceptance” and “extremely weak enterprise-level AI implementation capacity” is precisely the ideal point of entry for Chinese AI enterprises going global. Chinese enterprises can not only export SaaS-level software tools, but also fill the gap in Vietnam’s transition from technology to commercial monetization through enablement consulting, managed operations, and localized implementation.
Computing Infrastructure and Cloud Services: The Downward Expansion of the Chinese Ecosystem Amid a USD 7 Billion Infrastructure Boom
The explosive growth of artificial intelligence is inseparable from the three foundational pillars of “computing power, algorithms, and data,” and in Vietnam, the first major point of dividend realization lies precisely at the level of computing infrastructure.
In recent months, Vietnam has attracted more than USD 7 billion in investments in AI and data center projects, signaling the country’s attempt to reduce its dependence on traditional regional data hubs such as Singapore and to build its own digital sovereignty foundation and enterprise computing centers.
This wave of computing power development is driven not only by the natural growth of technological demand, but also by the regulatory push of Vietnam’s data compliance policies.
In addition to the localization requirements for high-risk systems under the Law on Artificial Intelligence mentioned earlier, Vietnam’s Personal Data Protection Law (PDPL) and earlier cybersecurity regulations impose substantive constraints on data localization, requiring both domestic and foreign enterprises that process personal or business data of Vietnamese citizens to store certain categories of data within Vietnam.
At the same time, the Telecommunications Law, which came into effect in July 2024, has fully liberalized foreign investment restrictions, allowing foreign companies to wholly own and operate data centers. This combination of “regulatory constraints” and “policy dividends” has prompted Chinese technology giants to deploy computing power infrastructures in Vietnam at an unprecedented speed and scale of capital investment.
The Breakthrough of Chinese Large Language Models in the Vietnamese Context
At present, the training corpora of mainstream global large models are overwhelmingly dominated by English. A recent study by the Stanford Institute for Human-Centered Artificial Intelligence (HAI) clearly points out that top-tier commercial large models experience significant performance degradation when handling relatively resource-scarce languages such as Vietnamese, often generating content marked by a strong “translationese” style or lacking local cultural resonance.
For a country like Vietnam, which possesses a unique cultural background, reliance on closed-source European and American large models not only means high API invocation costs, but also implies a loss of the right to define its own language and culture in the digital world.
Against this broader backdrop, open-source large models led by Chinese enterprises are entering a “golden period” in the Vietnamese market. From 2025 to 2026, Chinese indigenous large models represented by DeepSeek and Tongyi Qianwen have, by virtue of their highly aggressive open-source strategies, globally disruptive pricing, and strong native adaptability to Asian language families, generated enormous waves in the global developer community.
In specific areas such as natural language processing and long-context comprehension, Alibaba Cloud’s Qwen 3 has demonstrated stronger adaptability to the Vietnamese language. Qwen 3 adopts a Mixture-of-Experts architecture, not only massively expanding its multilingual training data, but also natively supporting multiple Asian languages, including Vietnamese.
In evaluations within the developer community, Qwen 3, with its extremely fast response speed, highly structured output, and near-perfect adherence to complex instructions, has outperformed many competitors in coding and architectural decision-making tasks. In open-source model assessments optimized for Vietnamese, the Qwen 3 series is widely recommended as one of the best choices for Vietnamese text generation, translation, and conversational processing.
The combination of Chinese open-source large models and localized Vietnamese data is giving rise to an entirely new model of “China–Vietnam collaborative” innovation. At present, Vietnam’s National Innovation Center (NIC), together with institutions such as Meta, has launched an ambitious project called “ViGen,” aimed at building Vietnam’s first—and by far the largest—open-source Vietnamese pretraining dataset.
The opening of this high-quality local corpus provides excellent “fuel” for Chinese AI enterprises.
Chinese technology companies, or their ecosystem partners in Vietnam, can fully leverage the ViGen dataset to conduct continued pretraining on the open-source weights of their large models, or carry out supervised fine-tuning for specific vertical industries such as Vietnam’s legal system and local medical guidelines.
This model cleverly avoids the geopolitical sensitivity that may arise from directly exporting Chinese values. By providing a powerful underlying reasoning engine, it helps Vietnamese developers build application-level large models that are “Made in Vietnam” and aligned with local cultural and ethical standards, thereby achieving deep penetration into Vietnam’s AI ecosystem at the technological foundation layer.
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