Capital financing for infrastructure investment

Capital for infrastructure investment across a series of key projects needs solutions to unblock financing. (Illustrative photo)

Infrastructure investment is becoming one of the crucial growth drivers of the economy for the 2026–2030 period and represents a long-term investment pillar.

Need for Large Capital Sources

The strategy prioritizing projects of strategic significance—such as the North-South Expressway, high-speed rail, urban railways, and more—comes with high expectations. Among them, the North-South high-speed railway is expected to form a modern transport axis across the country while boosting the railway industry, precision mechanics, new materials, and high-tech human resource training.

Beside national key projects requiring massive capital, a series of other key projects continue to be implemented with the participation of the private sector. The public-private partnership (PPP) model and investment projects are highlighted for their efficiency when transport infrastructure is connected synchronously while remaining tightly linked with land-use, urban, and industrial planning. This aims to elevate and complete the infrastructure landscape, paving the way for a high-growth economic cycle.

The foundation from a funding perspective rests on public investment policy. The scale of 8.22 quadrillion VND in public investment for 2026–2030 will contribute to improving capital efficiency, completing the infrastructure system, and steering toward sustainable economic development—provided it is disbursed effectively.

According to calculations by Ms. Dang Nguyet Minh, Head of Research at Dragon Capital, Vietnam's total investment capital demand for the 2026–2030 period will reach up to 1.5 trillion USD, double that of the 2021–2025 period. For such a massive amount of capital—equivalent to 2.5 times the projected 2025 GDP and roughly 4 times the current value of the entire stock market—Ms. Minh believes bank credit alone will not suffice. Even commercial banks will have to balance their capital allocations to meet medium- and long-term lending needs, supported by expanded limits on short-term funds used for medium- and long-term loans. Therefore, unblocking the bottleneck hinges on tapping into channels that can share the burden with the banking system.

Resolving the Bottlenecks

The capital market is a destination for medium- and long-term financing that holds high expectations. Ms. Dang Nguyet Minh stated that based on current realities, solving the capital puzzle for the new growth phase requires restructuring both the supply and demand sides of the capital market simultaneously.

On the supply side, Ms. Dang Nguyet Minh noted the need to add more technology companies, accelerate state-owned enterprise (SOE) privatization, and increase the ratio of free-floating shares to enhance market attractiveness. On the demand side, it is necessary to promote the development of domestic investment funds and pension funds, while creating conditions for fund management companies and securities firms to expand their operational scale.

“When these two bottlenecks are resolved, the capital market will be capable of sharing the burden with the banking system, creating a foundation for Vietnam to achieve rapid and sustainable growth in the new development phase,” Ms. Dang Nguyet Minh emphasized.

Regarding proposals to unblock demand, the Ministry of Finance is currently gathering broad public feedback on the draft Law amending and supplementing a number of articles of the Law on Securities. Many new provisions regarding securities investment funds are proposed in the draft law aiming to increase operational flexibility, diversify investment products, and expand the participation of both domestic and foreign investors.

In addition to amending the Law on Securities, the Government recently issued Decree 200/2026/NQ-CP in early June 2026, regulating the private placement and trading of corporate bonds in the domestic market and the issuance of corporate bonds to the international market.

This decree was issued as corporate bonds continue to play a crucial role in supplying medium- and long-term capital to the economy. However, according to Mr. Phung Xuan Minh, Chairman of Saigon Ratings, the market's development process also demands higher standards for issuer quality, stricter control over the use of proceeds, greater transparency, and bolstered investor confidence.

Mr. Phung Xuan Minh assessed that the goal of Decree 200/2026/NQ-CP is not to narrow the corporate bond channel, but to direct capital flows toward issuers with financial capacity, feasible capital deployment plans, and clear debt repayment responsibilities.

When information transparency, capital discipline, credit ratings, and supervision mechanisms are implemented synchronously, corporate bonds will continue to serve as a vital medium- and long-term fundraising channel. This provides the foundation for private enterprises to access better funding to participate in infrastructure projects.

However, Mr. Minh emphasized that while this is a necessary condition, execution quality remains the deciding factor. Regulations must be applied consistently, data must be fully disclosed, and violations must be detected and handled promptly. Furthermore, key regional infrastructure projects need to be promoted to increase opportunities for large-scale funding through local and municipal bond issuances. The return of local government bonds is expected by major cities like Hanoi and Ho Chi Minh City to resolve much of the capital crunch for infrastructure projects.