Healthcare & Vietnam

As one of the national development priorities, the Vietnamese healthcare sector has received increasing government budget allocations as well as interest from the private sector. Vietnam’s increased liberalization and global integration has led to considerable poverty reduction and improved livelihoods and opportunities for the population. Within healthcare Vietnamese citizens now have access to a greater variety of improved healthcare services. The Vietnamese government is increasingly focused on ensuring universal and affordable healthcare for the population and addressing the more adverse health determinants (e.g. environment, climate change, lifestyle). Rising household incomes and increasing health awareness have also contributed to the expansion of the sector.


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In the pharmaceutical industry in Vietnam, local firms are increasingly competing with international groups, which have led to an increased reliance on imported pharmaceutical products in recent years. According to UN Commoditites Trade Database (UNComtrade), in 2012, Vietnam imported VND38,616bn (US$1.9bn) worth of pharmaceuticals with India being one of the key providers for Vietnam’s market. Local production accounts for around half of the country’s pharmaceutical consumption, but only a tiny fraction of this is exported. The local pharmaceutical industry depends greatly on imports for 90% of its raw materials. Following its accession to WTO in 2007, Vietnam are giving rights for foreign enterprises to open branches in Vietnam and to import medicines directly.


Medical Devices


With a large population, steady GDP growth, and the increasing in many health problems namely food poison and cancer, Vietnam has an important and fast growing need for medical equipment and diagnostic products. However, the country’s stock of medical equipment remains small. Much of the country’s healthcare infrastructure is increasingly outdated and is in need of modernization.


Vietnam’s demand in medical device has generally been on a rising trend since 2009. The growth rate of this demand remained relatively high at averagely 9.49% for the years of 2011, 2012 and 2013. Experts forecast that there is a 80% chance that Vietnam demand for medical instruments, equipment and supplements will rise even further (10.60% to 13.02%) in the years to come.


There are four major types of medical device purchaser namely military hospital (19.43%), general hospitals (38.16%), small/ medium-sized health care centers (24.31%) and individual customers (11.23%).


Vietnam’s medical device market relies primary on imports from Japan, the United States, Germany, China, South Korea and Malaysia. There are only few domestic companies which are capable of manufacturing hi-tech products and they cannot really compete effectively because Vietnamese people as well as health care centers tend to prefer imported goods to domestic produced ones even if the prices of domestic goods are only one fifth of the foreign originated product of similar type.


Imports of instruments and appliances used in medical, surgical, dental or veterinary science, including scintigraphic apparatus, other electro-medical apparatus and sight testing instruments are generally increasing and forecasted to growth even further in the years to come.


Healthcare Services


In terms of the number of public health establishments (hospitals, regional clinics, sanatoriums and rehabilitation hospitals, medical services units, etc.), Vietnam has witnessed an overall increase, from 12,972 in 1995 to 13,506 in 2011, however, this figure slightly declined to 13.239 in 2012. The number of patient beds has increased annually, standing at 275,100 in 2012. However, this upward trend has not satisfied the growing demand in the country. Overcrowding in Vietnamese hospitals is a significant issue with bed sharing a common practice. Healthcare units with modern facilities and equipment are mostly located in big cities such as Hanoi and Ho Chi Minh while health centers in other provinces do not have access to more modern equipment and facilities. Given this disparity, people from rural provinces often seek treatment in larger urban hospitals, compounding the problem of overcrowding.


Market Potential


The country’s underdeveloped healthcare sector and its demand for expertise as well as its favorable demographics and high economic growth rates provide significant opportunities for foreign companies in various health sub-sectors such as pharmaceuticals, medical devices and healthcare services.


The growing demand for improved medical services by Vietnamese consumers is leading to greater competitions amongst domestic and foreign suppliers. Total healthcare spending in Vietnam is expected to rise from nearly US$7 billion in 2010 to US$11.3 billion in 2015, with an annual average growth rate of 10.3%. International enterprises’ advantages are largely contributed by local consumers’ preferences for imported products and their increasing income, which makes multinational brands affordable. Foreign companies are also competing amongst themselves for a share of the local market.


According to experts, best opportunities for medical devices in Vietnam are, among others, ones which help fight liver cancer, diabetes, orthopedics and cardiovascular diseases. Devices which will be strong areas of growth include operating theaters, emergency equipment, sterilizing equipment, patient monitoring equipment and imaging diagnostic equipment such as CT scanners, color ultrasound machines, MRIs and X-ray machines.


Vietnam’s entry into the World Trade Organization in 2007 opened up the medical and healthcare market to foreign investment. According to Vietnam’s WTO commitments, foreign services suppliers are, under certain conditions, permitted to provide services through the establishment of 100% foreign-invested hospitals, joint ventures with Vietnamese partners or through business cooperation contracts.

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   See also:


      Vietnam – Overview


      Vietnam’s Economy


      Holland & Vietnam 


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