Vingroup’s African Venture: Strategic Move or Risky Gamble?

In a recent interview, Nguyen The Trung, CEO of Capigrow and a financial expert, described Vingroup’s move as a “strategic, long-term decision that reflects the company’s international scale and capabilities.”

According to Trung, over two decades of development, Vingroup has demonstrated its ability to execute large-scale, complex projects across sectors such as real estate, healthcare, education, energy, and electric vehicles. These initiatives not only match the standards of leading regional conglomerates but also highlight Vietnam’s competitive edge in management, finance, and technology.

Additionally, Vietnam enjoys a rare advantage: a strong “national trust.” As one of the few nations with political stability, free from territorial disputes or major crises, Vietnam has established itself as a reliable partner for African countries.

“It’s no surprise that nations like Congo, Ghana, Indonesia, and India seek partnerships with Vietnamese enterprises, particularly Vingroup. This ‘national trust’ is a unique advantage not every country possesses,” Trung emphasized.

From a macroeconomic perspective, this aligns with the development cycles of East Asian economies. Historically, countries like South Korea, Japan, and China leveraged their “demographic dividends” to expand investments abroad, seeking markets, resources, and collaborations. Vietnam, with its growing internal capabilities, youthful population, and global ambitions, is now at a similar stage, with companies like Vingroup leading the charge.

The Democratic Republic of Congo (DRC) is a strategic choice, given its critical role in the global electric vehicle battery supply chain—a core focus for VinFast. The DRC holds the world’s largest cobalt reserves, approximately 4.2 million tons, with 2024 production reaching 244,000 tons, or 74% of global output. The country is also rich in copper and manganese, essential for electric vehicle manufacturing.

This presents an opportunity for Vingroup to vertically integrate its supply chain, from raw materials to battery and EV production. This long-term competitive advantage is particularly significant as Africa’s EV demand is projected to grow by 30% annually until 2030, according to the IEA.

Vingroup’s African strategy is more than a business venture; it’s a declaration of global ambition. While Africa presents significant challenges, it also offers Vingroup its most critical opportunity to solidify its success on the world stage.