Vietnam–Singapore Strengthening Bilateral Ties through Industrial Collaboration

Vietnam and Singapore share a longstanding and dynamic partnership that has evolved significantly over the past three decades. Central to this collaboration is the Vietnam–Singapore Industrial Park (VSIP) model, which has played a pivotal role in fostering economic growth, technological advancement, and sustainable development in Vietnam. As both nations continue to deepen their ties, the expansion of the VSIP network stands as a testament to their commitment to mutual prosperity and innovation.

Historical Context and Evolution of VSIPs

The inception of the VSIP model dates back to 1996 with the establishment of the first park in Binh Duong province. This initiative was a collaborative effort between Singapore’s Sembcorp Development and Vietnam’s Becamex IDC Corporation. Over the years, the VSIP model has expanded to encompass 20 integrated townships and industrial parks across Vietnam, covering approximately 12,000 hectares and attracting over 1,000 enterprises from 30 countries, with a cumulative investment exceeding USD 23 billion.

The success of the initial VSIPs has laid a strong foundation for the development of subsequent generations of industrial parks. In March 2025, the groundbreaking ceremony for VSIP Thai Binh marked the 20th such project, reflecting the sustained confidence and commitment of both nations to this collaborative model.

The Emergence of VSIP 2.0: A Vision for Sustainable and Smart Development

Recognizing the need to adapt to the evolving global economic landscape, Vietnam and Singapore have embarked on the development of the next generation of industrial parks—VSIP 2.0. This new model emphasizes sustainability, smart technology integration, and high-tech manufacturing. Prime Minister Pham Minh Chinh of Vietnam has highlighted the importance of upgrading existing VSIPs to align with these objectives, aiming to create ecosystems that integrate industry, innovation, urban development, services, and modern technology.

The VSIP 2.0 initiative is designed to incorporate green technologies, smart infrastructure, and sustainable practices, positioning these industrial parks as hubs for advanced manufacturing and innovation. This approach not only enhances the attractiveness of these parks to foreign investors but also contributes to Vietnam’s broader goals of economic modernization and environmental responsibility.

Strategic Expansion and Future Prospects

The expansion of the VSIP network is a strategic priority for both Vietnam and Singapore. In March 2025, during the official visit of Singaporean Prime Minister Lawrence Wong to Vietnam, both leaders witnessed the signing of memoranda of understanding (MOUs) aimed at developing new VSIPs in provinces such as Hung Yen, Hai Phong, Hai Duong, and Binh Duong. Additionally, construction commenced on the 333-hectare VSIP project in Thai Binh province, underscoring the momentum of this bilateral initiative.

These developments are aligned with the elevation of Vietnam–Singapore relations to a Comprehensive Strategic Partnership, which encompasses not only industrial collaboration but also cooperation in digital transformation, innovation, green economy, and clean energy. The expansion of the VSIP network is thus both a reflection of and a catalyst for the deepening economic ties between the two nations.

Impact on Vietnam’s Industrial Development

The proliferation of VSIPs across Vietnam has had a profound impact on the country’s industrial landscape. These parks have facilitated the establishment of modern manufacturing facilities, attracted significant foreign direct investment, and created employment opportunities for hundreds of thousands of workers. Moreover, the integration of advanced technologies and sustainable practices within VSIPs has contributed to the development of a skilled workforce and the enhancement of Vietnam’s competitiveness in the global market.

The establishment of new-generation VSIPs, such as those in Thai Binh and Quang Ngai, is poised to further accelerate the development of Vietnam’s industrial sector. These parks are designed to support high-tech industries, including electronics, automotive, and renewable energy, thereby diversifying Vietnam’s industrial base and positioning it as a regional leader in advanced manufacturing.

Source: various sources