Vietnam’s healthcare sector is experiencing rapid expansion, driven by increasing demand for quality medical services and ongoing infrastructure improvements. According to WHO Global Health Expenditure Database, Vietnam’s healthcare spending reached approximately USD 18.5 billion in 2022, accounting for 4.59% of the national GDP. The country’s healthcare expenditure is projected to rise to USD 23.3 billion by 2025 and USD 33.8 billion by 2030, reflecting a compound annual growth rate (CAGR) of 7.6% during the 2020–2023 period (AmCham Vietnam) This upward trend presents attractive opportunities for foreign investors to capitalize on emerging trends and support the country’s healthcare development.

  1. Changing demographics and increased healthcare demand

  • Aging population: Vietnam’s healthcare sector is being reshaped by significant demographic and socioeconomic changes. The country is experiencing a rapid decline in fertility rates alongside increasing life expectancy, driving it into a fast-aging population phase. According to the 2024 mid-term Population and Housing Survey, Vietnam’s total fertility rate (TFR) dropped to 1.91 children per woman, the lowest on record. The country is also experiencing one of the fastest-aging populations in Southeast Asia, with the proportion of people aged 65 and older projected to double from 7% in 2019 to 14% by 2036. This aging trend is fueling demand for long-term and specialized care, as older adults typically require more healthcare services and incur expenditures up to eight times higher than younger individuals. Demand for medical devices, especially for advanced diagnostic and surgical equipment is also surging, driven by rising chronic disease rates of the aging population, and growing patient expectations for early diagnosis as well as minimally invasive procedures.
  • Expanding middle class: By 2030, the middle class is expected to comprise over half of the population, with greater disposable income and higher expectations for quality care. This group is increasingly seeking premium healthcare services, including private clinics, advanced diagnostics, and wellness programs that offer higher standards and specialized treatments compared to the public system. Thus, there is a clear shift in consumer preferences toward private healthcare options and modern medical facilities.
  • Investment opportunities:
    • Long-Term and Specialized Care: The aging population and the rise in chronic conditions present a strong demand for long-term care facilities, specialized clinics, and pharmaceuticals. Investors can capitalize on this growing need by establishing or expanding services in elderly care, chronic disease management, and related healthcare services. Additionally, the medical devices market-having sustained an impressive annual growth rate of around 18% even during the pandemic-continues to offer strong opportunities for both foreign investors and manufacturers seeking to supply high-quality medical equipment.
    • Premium Healthcare Services: As Vietnam’s middle class expands, demand is rising for premium healthcare services, including wellness treatments, private clinics, and advanced diagnostics. This shift presents attractive opportunities for foreign investors to develop high-end medical facilities and specialized treatment centers tailored to more affluent consumers. At the same time, hospitals are increasingly diversifying beyond traditional acute care to meet demand for integrated services. This opens further investment potential in areas such as diagnostic clinics, teleconsultation platforms, rehabilitation centers, and home care services.

  1. Healthcare system overload and infrastructure gaps

  • Public hospital overload: Vietnam’s healthcare system is facing mounting strain as public hospitals grapple with persistent overcrowding and infrastructure gaps. Leading central hospitals such as Bach Mai and Viet Duc in Hanoi and Cho Ray in Ho Chi Minh City routinely operate over capacity due to patients from many localities flocking to big cities for treatment. As a result, patients face long wait times while medical staff work extended hours to meet demand. In response, many central hospitals have begun offering after-hours services to address the rising need for medical care. This overload is compounded by a chronic shortage of advanced medical equipment and limited financial resources for infrastructure upgrades. These challenges are particularly acute in central hospitals, but also affect provincial and district-level facilities, leading to disparities in access and quality of care across regions.
  • Hospital network expansion efforts: The government has recognized these systemic issues and is implementing comprehensive strategies to expand and modernize the hospital network. National targets call for increasing hospital bed capacity to 33 beds per 10,000 people by 2025 and 35 by 2030, with a long-term vision of reaching 45 beds per 10,000 by 2050. In line with this, the government aims to boost private hospital bed capacity to 15% by 2030 and 25% by 2050. A core policy priority of Vietnam’s Hospital Network Planning Strategy 2025–2030 is to promote healthcare socialization by encouraging non-state investment through public-private partnerships, equitization, and joint ventures.
  • Investment opportunity: The private healthcare sector is well-positioned to alleviate some of these pressures. Investors can explore opportunities in building or expanding private hospitals, clinics, and specialized care centers. Partnering with local hospitals offers a strategic opportunity to tap into the growing demand for high-quality healthcare. Collaborations can leverage the brand and expertise of foreign hospitals while benefiting from the local hospitals’ patient networks. For instance, foreign hospitals can establish flagship branches in Vietnam, offering international accreditation and training opportunities, as seen in the partnership between American International Hospital and Johns Hopkins Medicine. This model of knowledge sharing and operational support can be replicated across the country.

  1. Pharmaceutical localization and supply chain opportunities

  • Vietnam’s pharmaceutical sector is characterized by ambitious government targets for local production, but the industry remains heavily reliant on imports-particularly for active pharmaceutical ingredients (APIs). According to Decision No.1165/QĐ-TTg, the government’s strategy aims for 80% of domestically consumed drugs to be produced locally by 2030, and for domestic products to account for 70% of the total market value. However, only about 20% of raw materials used in drug production are produced within Vietnam, with the vast majority of APIs-up to 70%-imported primarily from China and India. This reliance is further exacerbated by rising raw material costs, creating a gap in the market.
  • Investment opportunity: Investors can capitalize on opportunities in the pharmaceutical sector by partnering with local manufacturers to enhance production capabilities and reduce reliance on imports. Additionally, there is significant potential for establishing local pharmaceutical manufacturing facilities that meet international quality standards (e.g., EU-GMP). Through joint ventures or manufacturing partnerships, foreign investors can help address the supply gap and support the growing demand for domestically produced pharmaceuticals.

  1. Digital health transformation

  • Trends: Tech-Savvy population & telemedicine growth 
    • The adoption of digital health solutions such as telemedicine, mobile health apps, and cloud-based healthcare services is on the rise in Vietnam. With internet penetration reaching 80% in 2023 and expected to hit 98% by 2026, digital healthcare is becoming more accessible.
    • Vietnam’s technological infrastructure is shifting towards cloud-based services, creating opportunities for the development of cost-effective and innovative healthcare solutions. With 4G networks covering >99% households, mobile and internet access is facilitating a digital health revolution. Increasing adoption of telemedicine solutions, especially in rural areas, is reshaping healthcare access.
    • The government has launched major initiatives aimed at improving healthcare infrastructure, including the Telemedicine Examination and Treatment project (2020-2025), which aims to integrate 24 upper-level hospitals into a telemedicine network. Several medical processes have been digitized, including registration with chip-enabled IDs linked to health insurance, cashless payments, app-based appointment scheduling, and electronic health record (EHR).
  • Investment opportunity: The digital health ecosystem in Vietnam is expanding with advanced healthcare technologies such as AI, telehealth, and robotic surgery becoming increasingly mainstream. Collaboration between hospitals, tech companies, and the government is essential to successfully implement these technologies. Investors can tap into this market by developing or partnering with digital health startups, especially given the increasing government support for telemedicine and remote healthcare solutions.  Technology companies can benefit from hospital partnerships to expand their customer base, while the government can foster innovation by creating a regulatory environment that encourages collaboration.

Vietnam’s healthcare sector is on the cusp of significant growth, driven by demographic shifts, government initiatives, and rising consumer demand for quality care. Key investment opportunities lie in pharmaceuticals, medical devices, digital health, and private healthcare services. To capitalize on these opportunities, foreign investors should focus on long-term partnerships with local entities, leveraging government support and addressing the unmet demand in both urban and rural areas. With a strategic approach, Vietnam offers a rewarding environment for investors aiming to make a meaningful impact while achieving substantial returns.

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