Vingroup tests the line of Vietnam's new capitalism

Asia Times

15-05-2025

On May 11, 2025, Vietnamese media widely reported that Vingroup, one of the nation's most powerful private conglomerates, offered to take full control of the North–South high-speed railway project.
However, less than 24 hours later, the headlines suddenly vanished as articles disappeared online, links went dead and state-controlled media fell silent. The cause behind the censorship: the full proposal had leaked online, revealing terms that shocked the public and ignited a backlash.
Pham Nhat Vuong, Vingroup's founder and Vietnam's first dollar billionaire, signed the May 6, 2025, document, which reports showed was addressed directly to Prime Minister Pham Minh Chinh and Deputy Prime Minister Tran Hong Ha.
In it, VinSpeed, a newly formed Vingroup subsidiary, asked to be the sole investor and operator of the $61 billion railway project. The state was requested to pay for 80% of the figure —around $49 billion—via a zero-interest loan over 35 years, while VinSpeed would provide the remaining 20%. Land clearance costs were not included in the proposal, sparking speculation that they would be paid by the state.
The company also asked to be designated the investor for urban development and real estate projects along the railway route, especially around stations, in order to mobilize extra funds. In addition, it requested the right to use the state loan as interim operating capital for its broader business activities.
Finally, it proposed to set a floor for ticket prices at 60–75% of prevailing airfare price ceilings.
It wasn't the proposal's ambition, but rather its terms, that set off the public uproar expressed mainly online. Many questioned in chat forums why a private company should request tens of billions of dollars worth of interest-free public loans, gain control of adjacent real estate and set price floors with little transparency and no competition.
By May 12, most news coverage of the proposal had vanished. Two days later, on May 14, state media reintroduced the story—this time framed as a patriotic initiative aligned with the ruling Communist Party's goals.
But by then, the original leak had already opened a much larger conversation about private capital, political power and the future direction of Vietnam's economy under new leadership.
The VinSpeed leak and the media fallout became a live experiment in how power, capital and policy are bargained over in communist-ruled Vietnam. Three general interpretations have emerged.
One sees the incident as evidence that Vingroup—long regarded as the most politically connected private conglomerate in Vietnam—may have lost some of its unspoken Party protection.
Yet despite VinFast's challenges and rising debt, the group continues to receive selective state support. Political backing for VinFast's overseas push and, most recently, government approval to study a metro line to Can Gio, suggest formidable influence with the Party.
A second view sees the proposal as calculated overreach. According to this reading, Vingroup submitted a knowingly unviable bid to appear patriotic without assuming risk. Given its strained finances, the group may have preferred to bow out without seeming obstructive.
But the 14 May state media campaign undermines this view. Far from backing away, VinSpeed reasserted its interest—publicly, proudly and in full alignment with Party messaging. Whatever missteps may have occurred, the group is now visibly committed to the pitch.
A third, and arguably more grounded, view sees the proposal as a real bid from a powerful actor who misjudged the moment. The North–South high-speed railway is not just another infrastructure project. It's a flagship national undertaking: politically symbolic, technically daunting and economically massive. Vingroup's bid to take full control as sole investor came off, to many, as strategic overreach.
From this perspective, the leak—and the resulting public storm—was likely encouraged or amplified by other political or business factions that viewed Vingroup's bid as a threat to their own interests.
The combination of elite competition and public blowback likely played a role in the state's decision to halt news coverage of the proposal. The quick restoration of media reporting on 14 May, now with carefully worded patriotic framing, suggests not a rebuke but a recalibration.
There is also a subtler possibility. What if it wasn't just the Party leadership, but people close to Vingroup's Vuong, who moved to limit state media coverage after the leak?
With public anger mounting and elite resistance in the air, the effort to scrub state media may have been as much about damage control as it was about censure. Faced with sudden public blowback and intra-elite friction, people close to Vuong may have worked behind the scenes to buy time, recraft the narrative and reintroduce the proposal under safer political cover.
The VinSpeed incident delivered a clear, new signal from the Party's apex. On May 11—the same day the Vingroup headlines broke—Communist Party General Secretary To Lam published a major economic article titled 'A New Driving Force for Economic Development.'
Since becoming Party chief in July 2024, To Lam has consistently cast the private sector as central to Vietnam's economic future. In his various articles, To Lam notes that Vietnam's economic growth depends on a stronger private sector. He has said he wants private businesses to contribute 70% of GDP by 2030.
This shift in thinking is backed by policy. In May 2025, the Politburo issued Resolution 68—the Party's strongest statement of support for private enterprise in decades.
The resolution calls for institutional reforms, stronger legal protections for property rights, easier access to capital, and 'rapidly developing large enterprises, medium-sized enterprises, and regional and global private economic groups.'
Although it borrows from China's playbook, the language is fresh and telling, suggesting a move toward fostering strong homegrown conglomerates as state-supported champions in a socialist-oriented market economy.
Just days after Resolution 68's release, the leaked VinSpeed proposal blew up. The clash exposed a deeper contradiction between the new ideology of pro-private reform and the political cost of perceived privilege.
Resolution 68 promises playing field fairness, competitive access, legal safeguards, transparency and civil, not criminal, remedies. In To Lam's own words in his article, 'administrative thinking must shift from control to collaboration—treating enterprises as partners to support, not police.'
But what happens when those 'partners' ask for more than the public will tolerate? The VinSpeed episode may soon be forgotten, but the inconsistency it revealed will not.
In a system that purports to mix socialism and private enterprise, public legitimacy still counts for something. Even in Vietnam or China, the public can push back—not through courts or ballots, but through backlash and mockery.
Resolution 68 offers a legal shield for private entrepreneurs. But unless it visibly puts cronyism in check, it risks functioning as a shield only for the rich and powerful.
What the VinSpeed case shows is that even overreach can be rehabilitated if the actor adapts. The real danger isn't that elites try to extract more than their fair share – it's that, with the right messaging and timing, they may succeed. A leaked memo one day becomes patriotic policy the next.
And what happens when the next company doesn't ask for a zero-interest loan on paper, but quietly receives one through backdoor clauses, land swaps or zoning tweaks dressed up as legal form?
In that scenario, Vietnam may still grow. But it will be a model driven by selective access, not shared rules. The test for the Party is no longer whether it can deliver growth and prosperity, but rather if it can draw a line that even its preferred firms cannot cross.
Without it, Vietnam's reform will be an unstable bargain delivering prosperity for a few, limited improvements for some and an ultimately bad deal for the many.
Leo Tran writes about international affairs, trade, and global strategy. His work has appeared in the Chicago Tribune, The Diplomat, and Kyiv Post. He also publishes at Vietnam Decoded.