BMI View : Our outlook for Vietnam ' s construction and infrastructure sector remains positive, supported by strong economic growth, regulatory changes, large FDI inflows and strong project pipeline.
Latest Updates And Structural Trends
Our outlook for Vietnam's construction industry remains positive and we forecast real growth of 5.5% and 6.3% in 2016 and 2017, respectively.
We forecast transport infrastructure growth to peak at 6.8% in 2016. The Ho Chi Minh City People's Committee has submitted for a list of priority transportation projects to government, for approval, that will be developed in a public-private partnership (PPP) format between 2016 and 2020, including a monorail line project, which underscores the significant growth potential of the sector.
With power consumption expected to almost double between 2016 and 2025, we expect energy and utilities infrastructure to grow at an annual average rate of 5% during this period. There is a long list of projects in the pipeline as the government plans to step up the country's power generation to meet growing demand and avoid further power shortages.
|e/f = BMI estimate/forecast. Source: Vietnam General Statistics Office, BMI|
|Construction industry value, VNDbn||215,482.72||231,785.20||257,688.57||286,016.24||317,185.41||351,637.62||389,400.12|
|Construction Industry Value, Real Growth, % y-o-y||2.04||5.47||6.28||6.09||6.10||6.06||6.04|
|Construction Industry Value, % of GDP||5.1||5.1||5.1||5.1||5.0||5.0||5.0|
Vietnam has kept its score of 54.3 out of 100 in our Asia Pacific infrastructure Risk/Reward Index. It remains in the lower half of the rankings in 13th position, out of 21 countries. This is largely owing to the high business risks due to corruption and significant potential for delays to project development.
The country has one of the fastest moving business environments in the region. Rapid expansion has raced ahead of the regulatory environment and after Indonesia the country is an outperformer among emerging South East Asian countries in terms of rewards.
Industry Risks are the largest hurdle for Vietnam as the country continues to score only 40 in this category, below the regional average of 61. This is indicative of structural weaknesses in the infrastructure sector, which in turn pose long-term risks to investors.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Vietnam Infrastructure Report features BMI Research's market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Vietnam Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Vietnamese infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Vietnam to test other views - a key input for successful budgetary and planning in the Vietnamese infrastructure market.
- Target business opportunities and risks in the Vietnamese infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Vietnam.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.