The current priority is to develop large-scale, modern logistics centers and turn Vietnam into a regional hub

New race for logistics growth

Dao Trong Khoa, Chairman of the Vietnam Logistics Business Association (VLA), said more than thirty years of reform have transformed Vietnam from a closed economy into one of the region’s fastest-growing economies. By 2026-2027, total trade is expected to exceed US$1 trillion, placing Vietnam among the world’s top 15-20 trading nations. At that point, the logistics system will need to be strong enough to support quality growth and deeper integration.

Even so, a major concern remains that most value-added activities are still concentrated in the foreign direct investment sector. Domestic businesses account for only around 40% of localization, mainly focused on basic processing and assembly. As nominal GDP is projected to reach US$1 trillion around 2031-2032, pressure on the national logistics infrastructure will continue to grow.

Despite strong prospects, the market is facing headwinds from geopolitical tensions and global inflation. The biggest bottleneck limiting competitiveness is that logistics costs in Vietnam still account for 13-15% of GDP, significantly higher than in other countries in the region. To address this issue, Nguyen Le Hang, External Relations Director of SLP Vietnam, said current competitive advantages can be summed up in three words: savings, speed, and adaptability. Businesses that move faster will have an advantage in the new competitive landscape. The application of technology and modern infrastructure will help improve market forecasting, optimize delivery times, and increase operational efficiency.

Logistics has now been elevated into a strategic sector and formally institutionalized under Decision 2229/QD-TTg, which identifies it as an important economic sector and a driver of socio-economic development.

More recently, May 6 each year was officially recognized as Vietnam Logistics Day to honor the sector and raise awareness of its role in building a national identity and image for Vietnam’s logistics industry, while also reflecting the Government’s strong commitment to developing logistics into an important economic sector with high added value, sustainability, and international competitiveness.

The current priority is developing large-scale and modern logistics centers to turn Vietnam into a regional hub. Bui Nguyen Anh Tuan, Deputy Director of the Domestic Markets Department under the Ministry of Industry and Trade, said the breakthrough lies in creating a “convergence point” between infrastructure, markets, and data. Logistics development should not be spread out. Instead, there should be clear classifications for national, regional, and local logistics centers, helping avoid overlapping investment and underutilization.

Industrial real estate in a new growth cycle

If logistics is the system that moves goods, industrial real estate is the physical foundation that allows that system to operate. Industrial parks, logistics centers, inland container depots, ready-built factories, and modern logistics hubs are increasingly being integrated into ecosystems supporting production, storage, distribution, and exports. As global supply chains undergo major restructuring, Vietnam’s competitiveness will depend increasingly on the ability to build synchronized connections between industrial and logistics infrastructure.

The connection between industrial real estate and logistics is also reshaping the market through a growing shift toward ESG standards covering environmental, social, and governance factors. Dr. Le Xuan Nghia said ESG gives businesses two important “passports”: access to international markets and access to capital from domestic and foreign banks and investment funds. Many financial institutions now consider ESG reporting a priority criterion when providing credit to businesses.

Many domestic companies have already joined the “green transition” race. Tran Ngoc Khanh, CEO of OPL Logistics Joint Stock Company, said the company is operating more than 120,000 square meters of warehouse space powered entirely by solar energy, while also investing in vehicles meeting Euro 5 standards and planning further investment in LNG-powered or electric vehicles in the near future.

Alongside the green transition is a growing wave of automation. According to Savills World Research, labor shortages and rising labor costs are accelerating the adoption of AI and robotics in warehouse operations. In Vietnam, infrastructure development remains critical. Northern Vietnam is seeing rapid growth in electronics and semiconductors, while the South is placing expectations on large-scale infrastructure projects to reshape transportation flows.

John Campbell, Director of Industrial Services at Savills Vietnam, said infrastructure development is opening new industrial clusters, while support policies for high value-added industries will help strengthen industrial growth momentum in 2026. Vietnam’s digital capacity is also expanding through the development of large-scale data centers, creating a completer and more competitive industrial environment.