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With a favorable business environment, competitive labor costs, and a supportive government, Vietnam is rapidly becoming a preferred destination for IT outsourcing. In this article, we explore why Vietnam is an ideal location for businesses looking to outsource their IT needs and the country’s advantages in terms of cost, quality, and reliability.

1. An Overview of Vietnam’s IT Sector 

Vietnam’s IT sector has been rapidly growing in recent years. According to a recent industry report, Vietnam’s Information Technology communication (ICT) market had an estimated value of USD 7.7 billion in 2021 and it is expected to grow at approximately 8% per year from 2022 to 2026 as both the public and private sectors increase adoption of ICT solutions.  

The government of Vietnam has identified ICT as a major industry and socio-economic growth driver and is urging government agencies at all levels to apply advanced ICT solutions towards the goals of improving operational efficiencies and providing better governance services. In particular, the government of Vietnam has approved the National Digital Transformation Program through 2025, with vision to 2030, which will further support the growth of the ICT market. 

Some of the key sub-sectors in the IT industry in Vietnam are: 

IT outsourcing in vietnam
  • Telecommunications: There are five mobile operators and three mobile virtual network operators in Vietnam, with a combined market share of approximately 95%. The revenue from traditional telecommunications services is expected to decline due to the saturation of mobile phone subscribers and the popularity of over-the-top calling and texting services. Therefore, major operators have shifted their focus to providing digital infrastructure and services such as digital services, fiber optic infrastructure, digital payment, and cloud services. 
  • Software: Vietnam has developed to be a production hub for IT hardware and services such as software development outsourcing. Vietnamese software industries in banking and finance, oil and gas, aviation, and telecoms, which are the greatest spenders and provide the most potential for both bespoke solutions and off-the-shelf software, present the most lucrative prospects for foreign firms to invest in the country. Other areas with potential include IT services like customer relationship management (CRM), enterprise risk management (ERP), human resource management (HRM), cloud computing, digital content, and fintech. 
  • E-commerce: Among one of the fastest-growing internet economies within the Southeast Asian region, Vietnam’s e-commerce market value was forecast to reach 39 billion U.S. dollars by 2025, ranking second only after Indonesia. In Vietnam, the present digital population and rising internet penetration provide suitable conditions for e-commerce businesses to thrive. Consequently, the e-commerce share of total retail sales has been increasing fast in the country, while online channels have surpassed modern retail channels in terms of growth within the FMCG market. 
  • Fintech: Vietnam is among the emerging fintech markets in Asia. The market’s largest segment will be Digital Investment with a total transaction value of US$322.30m in 2023. 
  • Cybersecurity: Cybersecurity is a vital sector for Vietnam’s IT industry, as the country faces increasing cyber threats and challenges in protecting its digital assets and infrastructure. During the initial month of 2022, the Vietnam National Cyber Security Centre (NCSC) documented 1,383 instances of cyber attacks in Vietnam, indicating a significant rise of 10.29% compared to December 2021. To address this issue, the government of Vietnam has issued several laws and regulations on cybersecurity, such as the Law on Cybersecurity (2018), the Law on Information Security (2015), and the National Strategy on Cybersecurity (2019). The government has also invested in developing its own cybersecurity products and services. 

2. Top reasons why companies choose Vietnam for IT outsourcing destination.   

  • Why Vietnam?  

Cost efficiency: Vietnam can offer other global enterprises cost reductions, making it an appealing choice for any business all over the world. To prove it, the CIO magazine claimed that the cost of outsourcing development in Vietnam is 90% lower than that of US service  

High-quality IT engineer resource: Vietnam has about 400.000 IT Engineers and over 50.000 graduated IT Students from over 153 IT Institutions per year. Vietnam also ranks high in various developer skills charts, such as Skillvalue, Topcoder and.  

Proficiency in English: Language may be a significant barrier to success in the IT business, but the language barrier has been rapidly removed in recent years in Vietnam. Apart from the native tongue, almost all graduates, regardless of degree, are exposed to a second language, mainly English, placing Vietnam 13th in the Asian region in English ability 

Growing number of investors: Vietnam has attracted many foreign investors in the IT sector, such as Intel, Samsung, LG, Microsoft and IBM. These investments have helped to improve the infrastructure, technology and innovation of the Vietnamese IT industry 

Specialized Schools in Information Technology: Vietnam has many specialized schools and universities that offer high-quality education and training in information technology. Some of the notable ones are FPT University, Posts and Telecommunications Institute of Technology (PTIT), University of Engineering and Technology (UET) and Ho Chi Minh City University of Technology (HCMUT). 

Young population: Vietnam has a young population with a high proportion of graduates in computer science and engineering, providing a large pool of skilled IT workers. Vietnam’s education system has been modernized and has a strong focus on STEM subjects, resulting in a highly educated workforce.  

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3. Final thoughts 

At Source of Asia (SOA), we understand that finding the right IT talent can be a daunting and time-consuming task. That’s why we offer a range of hiring outsourcing services to support you throughout the recruitment process. Our team of experienced professionals provides strategic and operational support to ensure you find the best candidates for your business needs. We take care of background checks, payroll management, and HR consulting, giving you more time to focus on your core business activities. Additionally, our market and trends research ensure that you stay up to date with the latest industry developments. And if you’re looking to hire IT talent from Vietnam, we can also provide work permit and visa application support. Contact us at for more information.