Concrete industry around the world is steadily getting influenced by the concept of 3D printing and has made judicious use of it for implementing sustainable solutions for construction. Several construction companies that either supply or function in Vietnam have been quick to adopt the trend of 3D printing mortar that is being cited as a concrete solution to decrease excessive labor employed while constructing buildings. Siam Cement Group, a key market player of the Vietnam concrete and construction market have become one of the pioneers of 3D printing and developed a cement that has a special composition of fibers and powdered material that allows easy printing of shapes that are not traditional. In a first, the company used this new formula to print structural beams that were hollow on the inside, which makes these structures more resilient than their traditional counterparts.

Another construction trend that is emerging in Vietnam concrete and construction market is the development of recycled building materials. Vietnamese construction companies are also delving into importing high-grade and diversified materials such as concrete canvas, bamboo flooring, fiber-reinforced concrete, and others. The construction industry currently lacks proper resources to manufacture these products domestically, which is why they have resorted primarily to import them from South Korea. The demand for these products is rising despite the inclusion of import costs because of their ability to eliminate unnecessary construction-based additions such as steel bars and significantly assisting in cutting down construction time by 30%.

Vietnam’s Construction Industry Attracting Immense Foreign Direct Investment

According to Foreign Investment Agency, Vietnam will continue to attract foreign direct investment and has been able to attain FDI of $16.74 billion within the first five months of 2019. One of the primary factors that has influenced this development is the ongoing trade war between United States of America and China. This war has led investors to flock towards Vietnam that is being considered a favored choice for infrastructural development owing to its expanding tourism industry, which has directly benefitted the Vietnam concrete and construction market. Investors are shifting their factories from China to Vietnam in order to flee from the rising labor costs that China is reeling from the effects of. Labor intensive construction based projects have escalated in number and are receiving high investments for fast development. Popular tourist hubs including Hanoi and Ho Chi Minh City are receiving maximum investments to build their network of infrastructures in order to accommodate the increasing number of tourists.

Vietnam’s Burgeoning Population And Family Structure: Escalating Construction Demand

Though fertility levels have declined noticeably in all regions of the world, the world’s population is expanding at an alarming rate and incessantly rising with it is the demand for construction. According to collaborative estimations by United Nations and the World Bank, world population will reach 11.2 billion people by the end of 2100, with approximately 83 million people being added to it every single year. These statistics are reflective of the rising opportunities for the construction and architecture industries which are experiencing a high requirement for residential and commercial buildings. Vietnam has also contributed significantly to the rising world population and is continuing to do the same. Based on latest estimations provided by United Nations, the population of Vietnam stood at a tentative 97 million which is growing at an approximate rate of 1% every year. The government of Vietnam has made many efforts since 1960s to control the expanding population that has significantly contributed to housing crisis in the country. Despite Vietnam’s two child policy implemented by the country, the highly prevalent tendency to link happiness with a well-knit but large family continues to persist amongst Vietnamese population. The country is known for its extended families where people of several generations live together to co-exist and take care of each other. Families are often aesthetically similar to tiny societies, therefore requiring bigger residential complexes in most cases. A real estate bubble has been created in the country due to these reasons, as well as the continuously rising ageing population and an incessant influx of residential tourists from Indonesia, China, Japan, and other countries. This has acted as a strong growth driver for the Vietnam concrete and construction market and will be a propelling factor for instigating construction innovation during the forecast period.

Vietnam’s Incessant Influx Of Tourists: Rise of Residential Tourism

In the past decade, the country of Vietnam has emerged as a popular destination especially for residential tourists and migrants. Popularly known as a paradise for backpacker tourists, Vietnam has attracted tourists from all over the world for its beaches, and street markets. This has highly benefitted the construction industry as the demand for hospitality structures continues to rise. According to United Nations World Tourism Organization’s annual report on tourism around the world released in 2018, Vietnam stood on third place at the list of top ten nations facing maximum influx of tourists. This has influenced the hospitality industry which is now in the process of constructing five star resorts that can cater to the European population who according to the same report, are counted as the most likely to travel. Moreover, Vietnam is receiving a high influx of Chinese tourists ever since the opening up of Cam Ranh Bay, which has also contributed in extensive marine trade. Chinese tourists have noticeably strained the infrastructure in the country meant solely for tourists. According to many Vietnamese news resources, approximately 15.5 million tourists visited the country in 2018. In 2011, the Vietnamese government recognized the potential of the country’s emerging tourism industry and released the ‘Strategy On Vietnam’s Tourism Development Until 2020, Vision To 2030,’ which focused on infrastructural development as its main area of development. Despite these policies, the country still faces challenges pertaining to accommodation of tourists, managing capacity of airports, and infrastructure development of street markets, nightclubs, and beach resorts that Vietnam is famous for. Governmental investment on increasing airport capacity has been comparatively slower than the country’s other Asian counterparts whereas nearly all the hotels in Hanoi and Ho Chi Minh City (the most popular destinations in Vietnam) operate at their full capacities. Herein lies a strong opportunity for the Vietnam concrete and construction market which will capitalize on the rising demand for tourist accommodation in the upcoming years and with the help of governmental investment, create better opportunities for itself.

Vietnam Concrete And Construction Market: Emerging Opportunities

·    Transportation networks continues to be a key area in Vietnam that requires renovation on a large scale. In order to achieve that, the Vietnamese government recently launched VietNam Railway Transport Development Strategy towards 2020 that aims to build a completely new railway route that will feature a 1.435m gauge. Moreover, electrification of rail route stretching from the North to the South will also be carried out under this program. Some of the primary routes that will undergo upgradation are Ha Noi- Thai Nguyen route, Gia Lam Hai Phong, and others. This strategy will hold multiple opportunities for the Vietnam concrete and construction market and will help key market players in attaining a high amount of investment.

·       Surrounded by the ocean on a large side, Vietnam’s government is trying to elevate trade opportunities by investing in construction of seaports. Under the Master Plan for Seaport System Development 2020, the government plans on increasing economic growth of the country by constructing logistic centers and building better port infrastructure.

·      Vietnam has predominantly featured tube houses that are often termed as ‘vintage skyscrapers.’ These buildings are normally tall with three or more floors and are narrower that most buildings. They are found in the most populous areas of Vietnam such as Hanoi or Ho Chi Minh City where land was scarce when people migrated to find better opportunities. The multi-storied tube homes are a direct result of archaic taxation laws in the country that made people pay property tax based on the length of the front exterior of the house. This is however set to change as the government of Vietnam aims to increase area per capita from 16.7m2 to 25 m2 by the end of 2020. This is being implemented under several initiatives such as Housing for Poor Rural Families Program, and others. These schemes hold immense potential for the growth of the Vietnam concrete and construction market in the upcoming years.

Vietnam Concrete And Construction Market: Competitive Landscape

Key market players of this market have to consistently deal with the challenges of constructing space-effective and optimized buildings that could cater to Vietnam’s burgeoning population. During the forecast period, key companies are likely to shift their focus towards the emerging tourism industry in the country which holds immense potential for concrete structures. These companies include SCG Cement-Building Materials Co., Ltd., Vietnam Cement Industry Corporation, Chinfon Cement Corporation, Lafarge Holcim, and TAFICO. In 2017, Siam Cement Group, extremely prevalent in South-East Asia, further spread their footprint to Vietnam by acquiring Vietnam Construction Materials (VCM) for $440 million. This has acted as a highly beneficial step for the Vietnam concrete and construction market as VCM has immense potential to increase its production capacity with the help of SCG which currently stands at 3.1 million tons.

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