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People ride mopeds and motorcycles through a flooded street in Ho Chi Minh City. Photo: Shutterstock

Gridlocked and flood-prone, Vietnam’s biggest city struggles to keep pace with its own breakneck growth

  • Ho Chi Minh City need decisive action fast to overcome crowding and climate challenges and secure its 10 million residents’ future quality of life
  • Some bold ideas have been put forward, but funding woes and infrastructure paralysis mean its problems could turn into a drag on the whole economy

As soon as the roads are widened a fresh glut of cars moves in to fill them, says lifelong Ho Chi Minh City resident Thinh Pham, who fears urban planning is forever condemned to lag behind the unrelenting growth of one of Southeast Asia’s most dynamic cities.

Young, energetic and teeming with start-ups and finance houses, Vietnam’s biggest city and economic engine room is also facing some of its most urgent challenges: gridlocked roads, flooding and infrastructure that’s sagging under the weight of 10 million residents.

“I could be wrong, but when it comes to flooding they aren’t fixing any foundational problems, only building higher streets, and the city is sinking faster than they build,” Thinh Pham told This Week in Asia.

“I feel like people are moving here as fast as they expand the streets. There was a bridge near my house where they removed the sidewalks to expand the road … and two months after they finished the traffic was just as bad. The streets here are not made for cars. It’s crazy!”

Riders sit in traffic in Ho Chi Minh City. Vietnam’s biggest city is prone to congestion and gridlock. Photo: Shutterstock

Thinh Pham’s gripes are familiar to many of Ho Chi Minh City’s residents, grappling every day with the trials of life in a fast-growing megacity.

Experts warn that the congestion and overcrowding are symptoms of broader development struggles, with a lengthy list of essential projects facing extended delays likely to make the tough parts of city life even harder over the coming years.

“You need to classify these issues into two types of challenges,” said Andrew Jeffries, Country Director for the Asian Development Bank. “The first is the routine urbanisation headaches of pollution, congestion, access to public services, and affordable housing.”

“The other category would be the climate-related challenges, which are particularly acute,” he said. “These two types of challenges are going to intersect and create serious problems,” Jeffries said, citing the combination of rainfall and rising sea levels as “the top threat to the viability of Ho Chi Minh City”.

Plans for various bridges, ports, ring roads, parks, and cultural spaces for Ho Chi Minh City remain on paper years after being announced. Photo: AFP

Delays, poor planning create flood defence headaches

Delays to major infrastructure projects aimed at alleviating congestion and flooding are creating troubles for the future, experts warn.

The most high-profile is the city’s first metro line, which was initially set to connect downtown Ho Chi Minh City to the eastern suburbs by 2018. Construction of the Japanese-funded route began in 2012, but cost overruns and delays have pushed the opening date back to late 2023. Further lines are only at the planning stage.

Tan Son Nhat, the city’s airport, has been operating above capacity for years, but work has yet to begin on a planned third terminal despite the prime minister demanding this happen by September 30. A massive new airport is slowly taking shape in a neighbouring province, with the first phase expected to open in late 2025.

The roster of delayed projects also includes a US$437 million flood protection system that was initially scheduled for completion in 2018 and would reduce the risk of tidal flooding for more than 6 million people. It currently has no operational date.

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Various bridges, ports, ring roads, parks, and cultural spaces remain on paper years after being announced, causing Nguyen Phu Trong, General Secretary of the Communist Party of Vietnam, to call for city officials to prioritise infrastructure development during a recent visit.

The Asian Development Bank has ranked the metropolis among the 10 cities most likely to be severely affected by climate change. While it has not yet experienced catastrophic flooding like Bangkok or Jakarta, inundation caused by heavy rain and high tides is common in numerous areas.

A World Bank official who requested anonymity to speak freely about issues facing the city said that addressing rain and tidal flood risks separately is a mistake, while flood mapping and modelling are also poor.

“The most important events to ensure protection against are those where multiple hazards occur at the same time; a high rainfall event, during a high tide, when the river flow is strong,” the official said. “Without understanding the likelihood of occurrence and impact of these events, no flood protection system can offer comprehensive protection, and flooding will continue to occur.”

Houses are seen along the Xuyen Tam canal in Ho Chi Minh City. Photo: AFP

‘Ho Chi Minh City hasn’t got enough funding’

The worsening twin challenges of rapid urbanisation and climate change are exacerbated by two significant shortcomings in Ho Chi Minh City’s management.

“The most important reason for infrastructure delays is that Ho Chi Minh City hasn’t got enough funding,” said Le Hong Hiep, senior fellow at the ISEAS-Yusof Ishak Institute’s Vietnam studies programme.

“City officials have complained about this for a long time, as they generate a lot of revenue, yet they are not allowed to retain a large enough portion for investment and development.”

Ho Chi Minh City contributes 27 per cent of the annual national budget, or roughly US$25 billion, but only keeps 23 per cent of the revenue it generates. The rest is sent to the central government for dispersal to less-developed provinces. Before this year, the city’s budget retention rate was 18 per cent.

The capabilities of local governments are known to be limited in terms of planning, selecting contracts, and follow-through
Le Hong Hiep, ISEAS-Yusof Ishak Institute

“There have also been problems with execution and implementation,” Hiep said. “The capabilities of local governments are known to be limited in terms of planning, selecting contracts, and follow-through, so even when there is money, there are issues with poor quality, delays, and corruption, which has contributed to the rather poor condition of infrastructure.”

In an example of inefficient implementation, 100 public projects in the city received no funding in the first six months of the year, even though funds were set aside.

Prime Minister Pham Minh Chinh addressed slow disbursement on a national level at an online conference on Monday, saying: “If we can’t disburse the money we have, it’s our fault.”

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According to Hiep, an ongoing governmentwide anti-corruption campaign may have had the unintended consequence of panicking officials in charge of deciding where money should go and paralysing their decision making.

“The campaign has caused local officials to pursue self-preservation, so they don’t want to make decisions for fear of becoming the subject of a corruption investigation,” Hiep said.

“The government needs to consider how to fight corruption while also encouraging local officials to take the initiative.”

Construction on Ho Chi Minh City’s metro is seen in 2015. The line was initially set to open in 2018, but has been beset by cost overruns and delays. Photo: Shutterstock

Bold ideas for a new ‘city-within-a-city’

While infrastructure breakthroughs have been difficult, municipal officials took a bold administrative step in 2020 by merging three eastern districts into a sub-city called Thu Duc City, the first of its kind in Vietnam.

With a population of over 1 million, officials modelled this ‘city-within-a-city’ after London’s Canary Wharf or Shanghai’s Pudong, and theoretically gave it administrative autonomy to spur economic growth like China did with Shenzhen.

The goal is for Thu Duc City to become an economic hub accounting for seven per cent of national GDP. But it’s an experiment that’s still in its early stages.

Organisations like the World Bank see effective development of the sub-city as vital for Ho Chi Minh City’s sustainability as a whole, given the former’s relatively low population and building density.


Typhoon Noru knocks out power, floods streets in Vietnam

Typhoon Noru knocks out power, floods streets in Vietnam

Flood protection will be a key part of its growth and a chance to set a model for future urban development.

“We need a clear vision and strategic concept for flood risk management in Thu Duc City in a way that directly contributes to the city’s long-term development,” the World Bank official said.

“The first step is to ensure a high amount of flood retention … the second step is to develop a system of physical protection. Development in the coming decades should be guided with flood risk in mind.”

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It is a common mistake of cities in the grip of breakneck growth to develop without considering flood risks and viewing offset land for water retention as wasted space, the official said.

“Rather, it can be developed as a system of parks, which increases land values and the profits of real estate developers,” the official said.

“In Thu Duc, there is a tremendous opportunity to build a system of linear parks next to canals, rivers, and streams to create a world-class recreation network.”

Lack of green space is a significant quality of life issue in Ho Chi Minh City, which has an estimated 0.55 square metres of public parks per resident, compared to 30 square metres in Singapore. City leaders have pledged to improve this figure, but central districts have little spare land.

The World Bank has suggested establishing a 500-hectare area for recreation and tourism in Thu Duc similar to Singapore’s Sentosa Island and relocating the city’s historic but poorly maintained zoo to this space.

“Relocating the Saigon Zoo and developing the 20 hectares of land it occupies could create up to US$9 billion for the city government through land rights sales for commercial development and adjacent riverfront development,” the World Bank official said.

Decisive action needed for city’s future

Experts agree that action is needed now on mass transit, flood protection, traffic management, green space, and other drivers of Ho Chi Minh City’s future quality of life.

“The city is still relatively liveable in many ways and could potentially become a great city, but it could also go south,” Jeffries said, adding that “real political will” was needed to drive change.

“It’s much harder to deal with a problem 20 years later when there’s more development, people, structures, and congestion than now,” he said.

“But there’s nothing physical, geographic, or intrinsic that would stop the city from constructing a good, viable mass transit system, keeping green spaces and putting in flood management.”

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Without decisive action in the economic dynamo that is modern-day Vietnam, Ho Chi Minh City’s infrastructure problems could turn into a drag on the country as a whole.

“The obvious victim of further delays is the economic growth of the city itself, and then, by extension, it will constrain Vietnam’s economic growth,” Hiep said.

For Diep Nguyen, a cafe owner and entrepreneur, much remains to be done to elevate the quality of life in Ho Chi Minh City.

She says traffic is a daily grind and while some roads on her routes have been upgraded, flooding in her cafe’s neighbourhood “seems worse every year”.