Vietnam among world's fastest growing data center markets
As demand for data and its storage increases around the world, previously underserved data center (DC) markets are quickly establishing a presence on the main stage, write Savills Vietnam analysts.
Governments in Indonesia, Malaysia, and India are investing heavily in digital infrastructure, attracting global operators. This article explores Asia’s booming data center, which is driven by rising demand from digital economies.
Developing data center markets in Asia
Globally, emerging data center markets are largely serving the needs of their own digital economies but also those of more developed markets.

Top 10 emerging global data center markets, 2023. Source: Savills Industrial Whitepaper, 2023
A Savills APAC report published last year highlights that Indonesia, Malaysia, Thailand and Vietnam have fewer data centers compared to Hong Kong and Singapore, despite significantly larger populations. India has fewer data centers than Australia.
“The world is now digital, with our populations and economies online. We are seeing notable growth in data center demand, and Asian nations are working to capitalize on this segment. For example, India, Indonesia and Malaysia have invested heavily in their digital infrastructure,” said Thomas Rooney, senior manager of Industrial Services at Savills Hanoi.
In Indonesia, 200 million of its 275 million citizens have internet access, and the country’s online retail market is forecast to reach $95 billion by 2025. Indonesia is a burgeoning tech hub, with homegrown unicorns including GoTo, which raised more than $1 billion when it was listed last year.
Indonesia’s data centers are also likely to serve other markets. For example, Batam, an island near Singapore, is set to be a future data center hotspot, serving domestic needs but also demand from Singapore. Batam has conventional and renewable power sources, making it attractive to operators.
Malaysia has also invested in its digital infrastructure, with more underwater cable links, boosted domestic connectivity and 5G. This has sparked interest from foreign companies, such as Australian data center operator NEXTDC, which is building a 65MW colocation center; it will be Malaysia’s largest Tier IV facility.
India has the world’s largest population and increasing wealth levels, which are driving the need for data center development. Savills research highlights that it added 150MW of capacity in 2022 and forecasts expect a further 250MW in 2023, bringing the capacity to more than 1GW.
Government-led initiatives such as Digital India, and an emphasis on self-reliance and data protection through data localization are expected to increase the data volume in India, which will create increased demand for data centers.
Vietnam’s data center industry
Vietnam’s cloud and data center industry is one of the fastest growing in the world. It is driven by the digitalization of the local SME sector, a young and digitally literate population, the arrival of 5G, the need for self-sufficiency in digital infrastructure, and data localization laws.
According to Savills Industrial Whitepaper 2023, Vietnam has 28 data centers with a total capacity of 45 MW with 44 service providers.
Since Q1/2021, enquiries from foreign data centers operators looking for locations and potential joint-venture partners have increased on the back of hyperscales announcing interest in Vietnam. In August 2022, Amazon Web Services announced the launch of edge data centers in Hanoi and Ho Chi Minh City.
Most of the players in Vietnam’s data center segment are local telecommunications companies such as Viettel IDC, NTT Global Data Centers, FTP Telecom, CMC Telecom, HTC Telecom International (ECODC), VNPT, and VNTT. IT Infrastructure providers include HP, Dell, Cisco Systems, Fujitsu, Hitachi, Huawei, IBM, Lenovo, NetApp, NEC Corp, and Oracle.
The government aims for Vietnam to become a key digital hub, and the data center market is forecast to grow to $1.04 billion by 2028, up from $561 million in 2022 and representing a CAGR of 10.7%. According to Viettel IDC, accelerating the commercialization of 5G technology is essential to meet Industry 4.0 movements like AI, big data, and IoT.
The government has a Digital Transformation Program, which aims to transfer 50% of business to digital platforms by 2025. Vietnam’s 5G connectivity supports edge data center deployment and offers last-mile connectivity and lower latency services. In February 2022, the Ministry of Information and Communication announced its research plans for developing 6G technology to cater to the fastest growing technology sectors.
The country has five existing submarine cables connecting to APAC and EMEA countries and the U.S. Two upcoming cables expected between 2023 and 2024 include Asia Direct Cable (ADC) and Southeast Asia-Japan Cable 2 (SJC2).

Thomas Rooney, senior manager of Industrial Services at Savills Hanoi. Photo courtesy of the company.
According to Thomas Rooney, rapid growth could emphasize risks related to data privacy, cybersecurity, sustainable resource consumption, reliability, and quality of service. These issues require legislative and land considerations from the government. Vietnam must address the challenges to embrace the opportunities presented by cloud, colocation, enterprise and edge computing.
“There is also potential for building portfolios here in the Asia Pacific, which will take time due to the fragmented nature of current ownership. However, the growth in specialist funds around the globe demonstrates the potential this sector holds. Recent data from Savills World Research highlights that although core investment strategies are likely to dominate in 2024, we are likely to see a rise in opportunistic investment in sectors like data centers,” Thomas said.
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