Vietnam's Digital Technology Law
Will it usher in a new digital era?
Welcome to the latest edition of The Ascent, presented by AVV. Coming to you from Ho Chi Minh City, this is your front-row seat to how the next-generation market of Vietnam is building global winners, one startup at a time.
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We recently released our Annual ESG & Impact Report for 2024, with takeaways including:
37% of deployed capital went to companies with at least one female co-founder
60% of our 25 portfolio companies are providing impactful products/services
Over 700 full-time jobs created by portfolio companies
Check out the report here.
GP Binh Tran, meanwhile, wrote a piece on the rise of ‘vibe coding’ in Vietnam and its potential impact on the startup ecosystem for Tech in Asia.
Let’s get into our Spotlight for the month: the recent passage of Vietnam’s Law on Digital Technology Industry, the first standalone law focused on this sector in the world.
The Digital Technology Law
On June 14, the National Assembly passed the Law on Digital Technology Industry, with domestic media hailing the legislation as the first of its kind globally.
Set to go into effect January 1, 2026, the law aims “to accelerate Vietnam's digital transformation, empower domestic tech companies to grow sustainably, deepen integration into global markets, and elevate the nation's prominence in the digital age.”
The legislation covers areas including semiconductors, AI, and digital assets.
It sets out targets including the creation of an ecosystem with 150,000 digital enterprises by 2035 while outlining incentives for a range of stakeholders, from foreign-invested firms and SMEs to startups and R&D activities.
A focal point is the development of digital talent, with “digital technology talent” defined as “individuals with notable expertise and achievements in the sector across both public and private domains.” As with Resolution 68, which we discussed last month, the key will be in implementation and execution, areas where other ambitious laws have struggled in the past.
For example, one aspect that has garnered plenty of international attention is the law’s recognition of digital assets as a legal item.
While this has been greeted with a lot of excitement in crypto circles, we’re still advising caution. As The Business Times reported, new crypto regulations in the works could prove onerous, and it’s unlikely this will be the unfettered market some are hoping for.
Vietnam Tech in the News
Qualcomm Expands
Qualcomm opened an AI research and development center in Vietnam focused on generative and agentic AI solutions across smartphones, personal computers, XR (extended reality), automotive, and IoT applications. This follows the corporation’s April acquisition of MovianAI, the genAI division of Vingroup’s VinAI. Qualcomm already has offices in Hanoi and Ho Chi Minh City and runs the Qualcomm Vietnam Innovation Challenge.
An AI Alliance Launches
On June 20, FPT Corporation hosted the launch of the Au Lac AI Alliance in Hanoi. It includes over 20 top domestic tech companies and startups, including MobiFone, VNPT, FPT, MoMo, VNPAY, and Zalo. The alliance aims to help position Vietnam as a regional AI leader, with a main mission of developing LLMs that can understand and generate Vietnamese-language text.
VinFast Reports Financials
EV maker VinFast reported its Q1 financials in early June, with the Vingroup subsidiary championing its 36,330 car deliveries, up roughly 300% over the previous quarter. However, VF’s net losses were $712.4 million as the company logged its sixth straight quarter in the red. This was an improvement over Q4 2024’s immense $1.3 billion loss, but VF continues to burn incredible amounts of cash. A significant portion of those sales likely went to XanhSM, Vingroup’s electric taxi subsidiary, though VF did not distinguish between these figures. The company has expanded to Indonesia and the Philippines (with little to no sales data) and plans to open its factory in India within July, while its expansion plans in North America and Europe are paused and may never recover in the face of stiff competition.
AVV in Action
Binh took part in a Fireside Chat during the Climate Hero Club: Ho Chi Minh City Chapter launch on May 28th. It was an open dialogue between VCs, climate tech companies, corporates, and investors to share insights on the ASEAN investment landscape and collectively accelerate the region’s climate tech ecosystem. We’re looking forward to future Climate Hero Club events.
Eddie joined a panel at SuperReturn Emerging Markets in Amsterdam. He spoke about the short-term pain and long-term gain in Vietnam and Southeast Asia more broadly, along with how AVV is underwriting local talent. He also discussed Vietnam’s private sector promotion (i.e., Resolution 68) and the ongoing government streamlining, part of the country’s most ambitious reforms since the 1980s.
Adrian attended a meeting with the Hanoi People’s Committee to provide feedback on a draft resolution aimed at supporting public-private partnerships across science, technology, innovation, and national digital transformation. This puts AVV in direct communication with decision-makers on key innovation-related policies.
What we’re reading:
Read: Alibaba staffer’s resignation letter that got Jack Ma’s reply (Tech in Asia)
US pushes Vietnam to decouple from Chinese tech, sources say (Reuters)
Vietnam AI Economy Report 2025 (National Innovation Center)
How Meta’s $14 Billion Scale AI Investment Upended the AI Data Industry (Time)
See you next month,
The AVV Team