German Businesses Accelerate Investment In Vietnam’s Green Hydrogen Sector

German FDI is flowing increasingly into Vietnam’s hydrogen sector, particularly green hydrogen, over the past two years. What is driving this acceleration now, and what does Vietnam need to do to attract and retain these investors?

Vietnam’s green hydrogen market has become increasingly active over the past two years, with pioneering German FDI companies turning previously signed MOUs and commitments into concrete projects.

FDI Flows Shift From Mous To Concrete Projects

On August 20, 2026, Messer, a Germany-based industrial company, announced two projects worth a combined US$40 million in Thai Nguyen Province as part of its plan to expand its production network in northern Vietnam.

The projects include a 600-ton-per-day air separation unit (ASU) in Yen Binh, producing nitrogen, oxygen and argon, and a 300-ton-per-day nitrogen liquefaction plant in Song Cong. Both plants are expected to become operational in mid-to-late 2027.

More notably, Messer had previously announced an investment of approximately US$37 million to build a new industrial gas plant in Ho Chi Minh City.

Messer is not a new investor in Vietnam. The company has operated in the country since 1997 and is approaching its 30th anniversary in Vietnam. Beyond capital investment, Messer is also working with the German Agency for International Cooperation (GIZ) to develop green hydrogen skills at the Vietnam Green Hydrogen Center.

According to Henri Wasnick, Director of GIZ Vietnam’s Hydrogen Market Development Program (H2Uppp), this represents another form of long-term commitment: building local capabilities in preparation for future production expansion in Vietnam.

The 2025–2026 period has marked a more dynamic phase for Vietnam’s hydrogen market, particularly green hydrogen, driven by the growing participation of FDI companies.

Alongside Messer, Indefol has emerged as one of the pioneers in promoting cooperation on green hydrogen development in Vietnam.

In July 2025, Indefol launched the first green hydrogen project in Ninh Binh Province (formerly Nam Dinh Province) in cooperation with Siemens and GIZ.

Just three months after the project began, at the inauguration of the Vietnam Green Hydrogen Center – a milestone in public-private cooperation between the Vietnamese government and German businesses – Indefol signed two MOUs with Infineon and Wealth Power Group.

The agreements aim to promote projects integrating power electronics into a 1MW electrolyzer system and developing a net-zero industrial park.

The latest initiative launched by Indefol and other European partners is a 42 MWp Green Hydrogen and Fuel Cell project, which officially commenced in early July this year.

The project is being developed with the participation of Vietnamese and European companies, including EKPO (Germany), Indefol GmbH (Germany), ChillX (Vietnam), DFM Europe (France), as well as German and French financial institutions.

The Right Time To Invest

The key question is: Why now?

Based on close engagement with market participants, Wasnick said interest in hydrogen in Vietnam has existed for some time. However, the development direction only gained a clearer foundation after the National Hydrogen Strategy was issued in 2024.

The strategy, together with the revised Power Development Plan VIII (PDP8), Resolution 55 and Resolution 70, has helped establish a clearer policy framework and provide greater power-grid stability for integrating hydrogen into Vietnam’s energy system.

“What has changed is investor commitment, not simply interest,” Wasnick said. “We are seeing more capital allocations, joint ventures and technology partnerships.”

He pointed to Messer, Indefol, Bosch and Siemens as companies positioning themselves as key technology and service providers across the hydrogen value chain, while Vietnamese businesses are beginning to develop foundational projects.

This macro-level perspective from GIZ is consistent with what Messer is seeing at the corporate level.

“Messer, together with other companies operating in the sector, will contribute to overall development by bringing greater expertise and lower-carbon gas solutions,” a Messer representative said.

This reflects a growing alignment between Vietnam’s policy direction and corporate investment decisions.

Challenges Remain

As a company that has encountered practical barriers in the market, Messer identifies access to green energy as the biggest challenge.

Businesses need reliable access to renewable energy, a direct power purchase agreement (DPPA) mechanism and integrated infrastructure for transporting and scaling up hydrogen operations in Vietnam.

Nevertheless, the company remains confident that “everything is moving in the right direction toward a brighter future.”

On the technology side, Indefol currently has domestic capabilities covering around 50% of its IDF-EX1000X electrolyzer system, with the remainder sourced from Germany and France.

In April 2026, an Indefol factory director in Tay Ninh warned that hydrogen production “can be a dangerous game if control is lost,” particularly when gas purity falls below safe thresholds, according to VnExpress.

From a consulting perspective, the Director of GIZ Vietnam’s Hydrogen Market Development Program (H2Uppp) noted that successful hydrogen markets “typically rely on several foundational factors, many of which in Vietnam are still being developed.”

He identified four major groups of barriers:

• Financial viability: Pricing mechanisms that can make green hydrogen projects financially competitive with conventional alternatives.
• International standards and certification: Standards such as the EU’s Renewable Fuels of Non-Biological Origin (RFNBO) certification for export-oriented projects.
• Technical workforce: Skilled personnel capable of operating and maintaining electrolyzer systems.
• Power infrastructure: Electricity infrastructure capable of integrating a high share of renewable energy.

Looking Ahead

Vietnam’s green hydrogen market is still at an early stage and faces several challenges. At the same time, this creates significant opportunities for early movers.

Abundant renewable energy resources, a strong industrial base, Vietnam’s strategic position in Southeast Asia and its deep integration into regional supply chains provide a favorable foundation for investors.

According to Wasnick, companies entering the market at this stage can establish partnerships with Vietnamese businesses, test technologies, build project portfolios and develop local capabilities before the market enters large-scale commercialization.

If policies continue to be refined in line with the revised PDP8 roadmap, the gap between a potential green hydrogen market and a fully operational commercial market could narrow rapidly.

And the companies that make their move early may be among the first to benefit.