Vietnam Is Attracting Manufacturing Investment That Used to Go to China. The Numbers Are Striking.

Along the coast near Da Nang and throughout the industrial estates north of Hanoi, there is a subtle change that you can almost feel before the data supports it. Warehouses that didn’t exist three years ago are lined up with trucks. At shift change, factory workers in matching blue uniforms file out past signs in Mandarin, Korean, and Japanese as well as freshly poured concrete. When the numbers do show up, they are louder than the trucks because something is moving here.

Vietnam has been preparing for this exact moment for the past ten years. China’s investment in Vietnam increased from 955 to an astounding 1,275 newly licensed projects in 2025. The average project value fell precipitously from 4.95 million USD to 4.1 million USD, which may seem problematic until you consider the implications. There are more smaller projects that are dispersed more widely. It is the hallmark of a supply chain that is discreetly moving, line by line, factory by factory.

With 7 billion USD committed to 542 projects—a decrease from 10.21 billion in 2024—Singapore continues to lead the table. Investors seem to think that the long tail of smaller, more agile bets is all that’s left after the mega-deals have been written. Hong Kong still serves as a conduit for capital with questionable origins. Strangely, despite Samsung’s massive presence in the nation, South Korea has fallen out of the top ten by this metric. It is difficult to interpret that as a retreat rather than a pause.

However, Sweden is the story of the year—the one that no one could have predicted. four initiatives. $1 billion. the highest project value of any nation on the list, with an average of 255 million USD. Sweden was not even among the top ten in 2024. It moved up 59 spots to finish fifth overall by the end of 2025.

H&M and technology investor Vargas co-founded Syre Impact AB, a polyester recycling complex in Binh Dinh province, which accounts for the majority of that figure. By 2029, the plant, which will occupy approximately 29 hectares in Nhon Hoi Industrial Park, hopes to generate up to 250,000 tonnes of recycled PET pellets annually.

Syre’s supply network, in addition to its size, is what makes it intriguing. H&M has agreed to a 600 million USD seven-year offtake. Nike has consented to incorporate Syre’s recycled polyester into its main product lines, with Vietnamese factories currently producing over half of its worldwide footwear. Investors include the parent foundation of IKEA and Volvo. The lineup, which combines some of Sweden’s most well-known brands into a single Vietnamese company, has an almost theatrical quality as they all stake on the notion that circularity is now a production strategy rather than just a marketing catchphrase.

Conversations with logistics managers in Hai Phong raise the deeper question of whether Vietnam can handle all of this without straining. Although competitive, the labor market is no longer limitless. Pay has been increasing. Electronics plants are stealing workers, which is already putting pressure on traditional industries like shoemaking and textiles. Due in part to tax holidays that exempt qualified projects from corporate tax for four years and halve it for nine more, Foxconn, Pegatron, Quanta, and Compal have all expanded here. Yes, generous. Perhaps sustainable. Industrial booms have a tendency to appear inevitable until they don’t.

However, as you watch this develop, it seems that Vietnam is gaining more from the trade war between the United States and China. It’s more intentional than that. Seventeen free trade agreements, a coastline tailor-made for export, a government that has turned anti-corruption enforcement into a kind of national project. “Made in Vietnam” used to seem like a catch-all. It no longer does.