Vietnam is becoming an increasingly important part of Southeast Asia’s data-centre story. Cloud adoption is growing, AI is creating new demand for computing capacity, and companies are looking beyond established markets such as Singapore and Malaysia.

The investment pipeline reflects that interest. Vietnam currently has around 148 MW of live data-centre capacity, with another 79 MW under construction and 874 MW planned, according to BMI. Global and regional companies, including Google, Alibaba, Amazon Web Services, G42, ST Telemedia Global Data Centres, and Sembcorp, are exploring or developing capacity in the country. (Source: The Business Times)

But the size of the pipeline tells only part of the story. The harder question is whether Vietnam can provide the power, land, connectivity and long-term certainty needed to turn these plans into operating infrastructure. That is where the country’s data-centre opportunity is entering a new phase.

Demand Is No Longer The Biggest Question

There is little doubt that Vietnam has the demand story. Its digital economy is expanding, cloud services are gaining ground, and AI is creating another layer of computing demand. The country is also benefiting from a wider shift in Southeast Asia, as data-centre operators look for alternatives to markets where land and power are becoming increasingly constrained.

Earlier this year, for example, G42 announced plans with FPT and Viet Thai Group for three data centres in Vietnam, with consumption commitments of up to US$1 billion. This makes Vietnam attractive on paper. But a data centre is not a short-term technology project. It is a long-life asset that can require major investment in land, power infrastructure, cooling systems, and connectivity.

That changes the investment question. It is no longer simply “Is there enough demand?” It is “Can the infrastructure support that demand for decades?”

Power Is Becoming A Business Issue

The biggest challenge may be electricity. Vietnam’s power challenge could become even larger over the next few years. The country could face a power-capacity shortfall of 4,256 MW in 2027, rising to nearly 14,000 MW by 2030, as generation and grid projects fall behind schedule. The Ministry of Industry and Trade has also identified rising demand from data centres, AI facilities and electric-vehicle charging as part of the changing demand picture. (Source: AInvest)

For data centres, this is particularly important because electricity is not just another operating expense. It is fundamental to the business. Earlier this year, major Vietnamese operators including Viettel and CMC warned that a change from production to commercial electricity tariffs had pushed power costs up by more than 50% at some facilities, according to The Business Times. (Source: The Business Times)

That creates a difficult equation. More AI and cloud demand means more data-centre capacity. More capacity means more electricity consumption. But if power supply and grid infrastructure do not expand at the same pace, the economics of new projects become harder to justify. This is why the data-centre conversation is increasingly becoming an energy conversation.

A Good Site Is About More Than Land

The recent decision by ST Telemedia Global Data Centres to step away from a planned 60 MW facility in Ho Chi Minh City makes this point particularly clear. The project had been announced in 2024 on a 2.5-hectare site. But the company later concluded that the site no longer met its investment and commercial requirements. One important issue was the remaining land-use term, which ran only until 2041. (Source: DatacentreDynamics)

For an ordinary commercial development, that may not necessarily be a deal-breaker. For a hyperscale data centre, it can be. These facilities are designed around long investment horizons. Developers need confidence that the site will remain commercially viable not just when construction begins, but throughout the life of the asset.

That means looking at several things together: land tenure, available power, connectivity, scale, cooling requirements and the cost of operating the facility over time. A cheap site with uncertain power is not necessarily a cheap site. A well-connected site with limited room to expand may not be scalable.

And a large site with an unsuitable land-use term may not work for a project expected to operate for decades.

The Pipeline Is Not The Same As Capacity

This distinction matters when looking at Vietnam’s headline investment numbers. The country has hundreds of megawatts of planned capacity, but planned projects and operating facilities are very different things. BMI has already warned that realised capacity is likely to lag behind Vietnam’s headline pipeline because of electricity tariffs and grid constraints.

That gap is worth watching. The next phase of Vietnam’s data-centre market may therefore be less about how many projects are announced and more about how many can actually move through land acquisition, power connection, construction and operation.

In other words, execution will become a stronger measure of market growth than announcements.

The Infrastructure Around The Data Centre Matters Too

Power is not the only piece of the puzzle. Data centres also depend on strong telecommunications networks, subsea cable connectivity, cooling infrastructure and suitable locations. Vietnam’s earlier data-centre development has often been concentrated around Hanoi and Ho Chi Minh City, where demand and connectivity are strong but land and power constraints can also be more pronounced.

This could make locations outside the biggest cities more relevant to future development, particularly where developers can secure better access to power, land, and room for expansion. 

There are already signs of this wider approach. A proposed $3 billion data-centre complex in Dak Lak, for instance, combines AI infrastructure with renewable energy, energy storage and high-tech workforce training rather than treating the data centre as an isolated facility. The project points to how future digital infrastructure could increasingly be planned alongside the energy and talent needed to support it. (Source: VCCI)

Vietnam Still Has A Strong Opportunity

The infrastructure challenges do not erase Vietnam’s potential. In fact, they show why the opportunity is becoming more strategic. Vietnam remains relatively underserved. Cushman & Wakefield has described it as the most underserved data-centre market in Asia-Pacific, while BMI continues to see the country as a credible secondary Southeast Asian data-centre hub through 2030.

The country is also taking steps to improve the energy equation, including measures to support direct power-purchase agreements, self-consumption solar paired with battery storage, and investment in generation and transmission infrastructure. The opportunity, therefore, is not disappearing. The bar for executing it is simply getting higher.

The Next Competition Will Be About Infrastructure Readiness

For years, the data-centre race in Southeast Asia could largely be viewed through the lens of demand, investment, and location. That is changing. As AI increases the amount of computing infrastructure required, countries will increasingly compete on something less visible: whether they can provide reliable power, suitable land, strong connectivity and predictable economics at scale. Vietnam has the demand.

It has attracted serious investment interest. What comes next will depend on whether its physical infrastructure can keep up with its digital ambitions. That may ultimately determine how much of Vietnam’s impressive data-centre pipeline becomes real capacity — and how much remains on paper.