Vietnam data centre investments to reach $673 million by 2026

The data centre market in Vietnam is growing quickly, bolstered by a variety of factors including digital acceleration resulting from the COVID-19 pandemic. The data centre market by investment is expected to reach $673 million USD by 2026.

From 2021-2026, investments in Vietnamese data centres are expected to increase at a CAGR of over 8% per year. This expectation of growth is driven by circumstances including an increase in demand for data centre services and digital acceleration following the recent global pandemic. Additionally, in 2019 the country introduced the Law on CyberSecurity (LCS), which requires local and international businesses to store consumer data within the borders of the country. This increases demand by local and international enterprises for data centres located in Vietnam, creating an opportune environment for investment.

This growth will primarily be located near the urban centres of Hanoi and Ho Chi Minh City. Approximately 60% of the existing data centre capacity is centered around Hanoi today, in 12 different data facilities. In alignment with the existing focus on mitigating the environmental impact of the data centre across the industry, Vietnam has set its own green goals. First, they have committed to reducing greenhouse gases by 8% by 2030; and also, it is expected that 50% of data centre capacity will be powered by renewables by 2045.

As the primary markets in APAC / Southeast Asia are continuing to be built out by regional and international operators, secondary markets are gaining attention as investment opportunities. The data centre market in the Philippines is expected to reach $535 million over the next five years, growing alongside similar markets in Vietnam, Malaysia, and Indonesia.