Vietnam is revising its National Development Plan (officially called the National Master Plan) following the restructuring of administrative boundaries and in pursuit of sustained growth. The Ministry of Finance has been tasked with coordinating ministries, agencies and local governments to adjust the plan, which will be submitted to the government and then presented to the National Assembly at its tenth session of the 15th legislature.
On 29 August 2025, the ministry convened a workshop with international advisers. enCity was among the three consultancies invited to this workshop, standing out for our long experience in Asia, including Vietnam. enCity Deputy CEO Ms. Trang Vuong’s remarks extended beyond the national plan itself, addressing the broader planning system and the sectoral and technical plans that underpin it.
Adapting to a new context
The “new context” is not merely a redrawing of administrative lines. It also involves streamlining Vietnam’s bureaucracy. A merger of the Ministry of Planning and Investment with the Ministry of Finance, or of Construction with Transport, would fundamentally reshape the planning process. Planners themselves—not just the subjects of planning—would have to take on broader, cross-sectoral responsibilities. That could foster greater coordination, but it also increases pressure on those designing and executing the plan.
Externally, Vietnam must reckon with a world transformed by geopolitical tension, climate change, digital disruption, and fractured supply chains. Globalisation is no longer a frictionless field but a patchwork of regional blocs built on trust and resilience. These shifts bring both hazards and openings. To stay competitive over the next decade, Vietnam should focus on several fronts:
- Diversifying supply chains. The US–China trade war and other geopolitical shocks have exposed the fragility of global networks. Vietnam is well placed to exploit this moment by leveraging its position in Southeast Asia to become a critical link in emerging supply chains, a reliable hub for manufacturing and logistics. That requires heavy investment in economic corridors and strategic gateways.
- Building human capital. The demographic dividend will not last. Unless Vietnam transforms its young population into a skilled, creative workforce, the advantage will be squandered. This means far greater spending on education, vocational training and reskilling.
- Upgrading infrastructure. To anchor itself in global supply chains, Vietnam needs integrated roads, railways, ports and airports that cut logistics costs and sharpen competitiveness.
- Reforming the “software.” This will be decisive. Competitiveness can no longer rest on cheap labour. Investors now look for transparent policies, intellectual-property protection and a stable, predictable legal framework. Only then will Vietnam secure the trust of global firms.
Future planning must not only adapt to shifting domestic and global conditions. It must also grapple with three persistent sets of structural challenges: inconsistency, poor integration, and limited practicality.
1. Consistency from vision to delivery
Plans are meant to harness regional unique strengths. Too often, they proclaim bold, distinctive visions but fail to translate these into coherent targets or actionable measures. A good example of a plan that delivers consistency from vision to delivery is the regional plan for the Northern Uplands, approved under Decision 369/QĐ-TTg. Experts at enCity broadened its scope beyond economics to include social and environmental indicators, in line with its vision of becoming a sustainable, inclusive region and a national model of green growth. Additional metrics on human development, health, and social protection provided measurable outcomes to guide execution.
The plan includes additional indicators such as an HDI above 0.75, a life expectancy of 74 years, and lower infant mortality for communities in the Northern Uplands by 2030. Future revisions should follow suit, adding clear benchmarks that align with the broader vision alongside infrastructure and welfare strategies. This would help ensure consistency from lofty vision to practical delivery.
2. Integration within and across plans
Infrastructure shows most clearly where integration fails. Vietnam is pouring money into new projects: the North–South high-speed railway (from 2026), the Hanoi–Lào Cai line (2025), Gia Bình airport (2024), and several metro systems, yet coordination is lacking.
Apart from Long Thành, no international airport is directly connected to the national North-South high-speed rail. The metro to Gia Bình airport will not reach central Hanoi, forcing passengers into awkward transfers. In Hanoi, national and urban rail lines often run parallel without interchange stations. Nội Bài and Gia Bình airports lack direct public transport. Most planned high-speed rail stations have not officially incorporated transit-oriented development (TOD).
Such fragmentation will blunt the efficiency of the network, raise logistics costs, and weaken competitiveness.
Here are some of enCity’s suggestions for a synchronized network:
- Rail–air links: Connect the national high-speed rail with international airports through public transit. Locate rail stations inside or next to airport terminals, with walkways or internal shuttles; pilot in-terminal check-in at stations.
- Airport-to-airport connectivity: Complete the northern section of Ring Road 3 and add public transport between Nội Bài and Gia Bình.
- Urban–national rail links: Build interchange stations between metro and high-speed rail; synchronize timetables for “one-touch” transfers.
All are technically and financially feasible. If built in early, they would markedly raise the effectiveness of Vietnam’s infrastructure.
3. Greater practicality in definitions, classifications, development strategies, and resource allocation
A striking weakness in Vietnam’s planning is the gap between stated policies and real outcomes, especially in urban development. The government’s approach has been inclusive, narrowing rural–urban gaps, but large cities are losing productivity advantages to congestion, high housing costs, and weak infrastructure.
The World Bank estimates that gridlock alone costs Ho Chi Minh City US$1.3bn a year, 0.8% of city’s GDP. Unless infrastructure and policy catch up, growth poles such as Hanoi and Ho Chi Minh City risk losing their role as national engines.
What could be done?
- Improve practicality in urban definitions, classification, strategies, and resource allocation: Vietnam is urbanising rapidly, yet official figures understate the process. Some 60% of workers are now in non-farm jobs, but the official urbanisation rate is only 32.4%, far below regional peers. More than half of all new jobs created between 2011 and 2016 were in rural districts, showing that industrialisation is occurring outside cities, a reflection of urbanisation’s limits. The reason lies in Vietnam’s classification system, which bundles multiple criteria, from population size, infrastructure standards to spatial form, into a single definition. The result is paradoxical: many densely populated areas are not recognised as “urban” and thus miss out on investment, while peri-urban zones expand haphazardly without essential infrastructure, creating risks for both the environment and quality of life. The fix is simple: recognition should be based on density alone. Any area with more than 1,000 residents per square kilometre should be treated as urban. That would give a truer picture of Vietnam’s urbanisation rate and ensure infrastructure and services reach the places that actually need them.
- Improve the legal framework: Vietnam’s current laws inadvertently discourage better urban development. Three examples illustrate this. First, renewal of old apartment blocks has stalled—just 1.14% in Hanoi and 1% in Ho Chi Minh City—because regulations demand unanimous consent from all households. Second, fiscal incentives encourage local authorities to allocate land excessively to boost revenues, wasting resources and spawning “ghost” projects. Third, rigid rules on social housing—profit margins capped at 10% and minimum payback periods of 20 years—have deterred private investors. To resolve this, the government should shift to outcome-based regulation, focusing on results such as construction quality. Land-use fees should move from one-off charges to annual payments, creating sustainable revenue while curbing speculation. And investment terms should be loosened to attract more developers into affordable housing.
- Fairer fiscal allocation: Big cities, which generate jobs and growth, receive disproportionately little funding. In 2018, Ho Chi Minh City, with 9.5% of the country’s population, received just 5.2% the national budget spending. Can Tho’s per capita spending in 2017 was only 30% of Da Nang’s, despite similar incomes. The imbalance is worsened by poor data on migrants, who account for 36% of Ho Chi Minh City’s population and 18% of Hanoi’s. A new allocation model should follow three principles: social equity in welfare provision, development funds distributed by project effectiveness, and priority for high-risk areas. Such a system would give cities incentives to grow sustainably and competitively.
- Flexible and locally tailored standards: National rules should cover only essentials: fire safety, minimum living space, and social equity. Other measures, such as building setbacks, should be left to local discretion to preserve distinctive urban character, as in Hanoi’s Old Quarter or Hội An. At the same time, new standards should reflect sustainability: energy and water management, climate adaptation, and technology use. Traditional metrics, like the share of land devoted to roads, should give way to indicators that measure quality of life directly, such as the percentage of streets suffering congestion at peak hours. Such changes would allow cities to maintain unique identities, adapt to green and “smart” trends, and strengthen international competitiveness.
Conclusion
Revising the national plan is a rare chance to fix long-standing flaws and adapt to a shifting global environment. Administrative consolidation is not only trimming the bureaucracy but also creating an opening for more integrated, cross-sectoral planning.
To sustain growth, Vietnam must diversify its supply chains, invest in human capital, upgrade both hard and soft infrastructure, and pursue regulatory reform. Above all, planning must become more consistent, integrated, and practical.
With such an approach, Vietnam can build a planning system that is both flexible and effective, laying a sound foundation for sustainable growth and long-term prosperity.
Trang Vuong
enCity Deputy CEO
VI