🥖 Vietnam‘s VC Fund

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Vietnam’s market took a breather this week after the FTSE upgrade announcement, with the VN Index hanging in at around 1,700 points. Meanwhile, the government is cooking up something new: a National Venture Capital Fund backed by the state. The pot is not huge yet, but it is a tasty start for Vietnam’s next generation of founders.

Up north, China’s rare earth dominance is again on the world’s radar. But guess who is quietly becoming an interesting hedge? Yep, Vietnam might just be the next surprise.

And finally, Hanoi is tossing out fresh growth targets for 2026 and beyond. Double digits, of course. Because when has Vietnam ever aimed small?

Let’s dive right in.

Vietnam just made it official: the country’s getting a National Venture Capital Fund backed by state cash to kickstart the startup scene. The government is seeding the fund with an initial VND 500bn (about USD 20m) from the Ministry of Science and Technology’s budget. The goal? Ramp that up to at least VND 2 trillion (USD 80m) within five years by mobilising private capital too. Think of it as Vietnam’s answer to Silicon Valley’s VC ecosystem, except with bánh mì breaks and better coffee.

The fund will be structured as either a limited liability company or joint-stock company with independent legal status, complete with its own seal and bank accounts. Local provinces can even establish their own mini-VC funds using similar models. The Ministry of Science and Technology will act as the state representative, appointing capital representatives to ensure things don’t go sideways.

Vietnam‘s startup ecosystem is growing strongly with over 4,100 startups and about 290 VC firms. The scene has raised USD 3.2bn in total funding and Vietnam ranks 55th globally in the Global Startup Ecosystem Index 2025, maintaining its 5th position in Southeast Asia.

Most domestic funds don’t invest early or invest small, leaving countless startups in limbo. This state-backed fund aims to fill that critical gap, nurturing ideas from garage to market faster while catalysing more private investment into the pipeline.

China‘s tightened grip on global supply of rare earth sparked discussions all over media this month. With 70% of mining and 90% of processing under its control, Beijing’s quasi-monopoly is hard to ignore. But what about Vietnam? A US Geological Survey estimated Vietnam‘s rare earth reserves at 3.5 million metric tons - the sixth largest in the world. That’s a serious cache of materials essential for EVs, semiconductors, and even fighter jets.

Vietnam may become a new strategic hedge. Hanoi is drafting laws to classify rare earths as “special strategic resources”, restricting extraction and refining to state-authorised enterprises. Its national plan aims to process 2 million tons of ore per year and produce 60,000 tons of oxides annually by 2030. Essentially, moving from miner to manufacturer.

If Vietnam can master the processing technology, it could become a pivotal link in the global supply chain. A friendly alternative for the US, Japan, and others seeking to cut dependence on China.

Vietnam is swinging for the fences in 2026, with the Ministry of Finance unveiling a target of 10% GDP growth over the period of 2026-2030. If the ambition seems audacious, that’s because it is. International institutions like the World Bank and IMF project Vietnam’s economy will actually decelerate in 2026, forecasting growth rates between 5.6% and 6.5%, citing trade uncertainty, tariff headwinds, and tightening global financial conditions. Yet Prime Minister Pham Minh Chinh has made it clear that 2026 marks the first year of Vietnam’s “double-digit growth journey”. A bold bet that the country can sustain manufacturing momentum, public investment, and structural reforms to propel itself into a new era of prosperity.

To hit the 10% mark, Vietnam is betting heavily on economic restructuring, digital transformation, and strategic infrastructure. The 2026 plan prioritises the digital and green economy, semiconductor technology, artificial intelligence, and the development of two international financial centres in Ho Chi Minh City and Da Nang. Twin hubs designed to attract global capital, fintech innovation, and high-quality talent.

Exciting times ahead.

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See you next week! 🥖