Hanoi's residents endure upheavals as it transforms itself to match Vietnam's economic ambitions

HANOI, Vietnam (AP) — The noise is everywhere in Hanoi. The crack of a hydraulic breaker, the groan of excavators, the crunch of brick and concrete being torn apart.

As Vietnam pushes for double-digit economic growth, its capital is pursuing an ultramodern vision for the next 100 years. In the first half of 2026 alone, Hanoi spent $2.4 billion clearing land for nearly 1,500 projects, transforming one of the world’s oldest continuously inhabited capitals.

Authorities say the redevelopment includes flood-controls and measures to reduce air pollution as Hanoi adapts to extreme weather from climate change. Vietnam is among the nations most vulnerable, enduring frequent and intense typhoons, floods and extreme heat. The capital often is enveloped in thick smog as one of the world's most polluted cities.

The promise of progress comes at a cost of homes, livelihoods and familiar sites, as dust from demolitions drifts across neighborhoods, settling on rooftops, trees and the few buildings still standing.

Nguyen Thi Nhan used to sell fruit from her 300-square-meter (3,230-square-foot) street front home. It was demolished to make way for a road. She has yet to get compensation for its loss and now rents a home for her family and parents.

“We just have to wait. I don’t know where they will relocate us,” she said.

Big billboards display impressive visions of gleaming towers of steel and glass in new business and industrial districts, broad boulevards, parks and waterfront promenades. The plans call for the demolition of colonial villas, traditional narrow shophouses and densely packed low-rise buildings. The city will have new roads, bridges and transit links to airports and neighboring provinces.

The centerpiece is a $28 billion redevelopment along both banks of the silty Red River that runs through the city. It will cover 11,400 hectares (28,170 acres) — larger than the size of central Paris — and will feature new roads, parks, urban districts and, crucially drainage and other flood controls to contain chronic inundations.

A $35.2 billion Olympic sports area backed by Vietnam’s biggest company Vingroup will be anchored by one of the world’s largest soccer stadiums, shaped like a drum and capable of holding 135,000 fans.

Authorities also plan a major transport overhaul designed to reshape how Hanoi grows, reducing pressure on the city's historic center by creating multiple transport hubs.

Such modern infrastructure is vital to Vietnam’s efforts to attract foreign investment and create new opportunities for residents and businesses, said Nguyen Khac Giang, a visiting fellow at the ISEAS–Yusof Ishak Institute in Singapore. But he warned the construction boom also risks diverting capital from the high-tech industries Vietnam wants to develop. And it could also raise property prices, leaving banks exposed to bad loans if the market weakens.

Apartment and land prices have risen sharply, making homes in the country’s biggest cities unaffordable for many. Meanwhile many developers are heavily indebted, with debt levels higher than those of peers in countries such as Indonesia and the Philippines, according to a 2025 S&P Global report.

Real estate makes up about 3.5% of Vietnam's GDP, but accounts for roughly a quarter of bank lending.

“There are huge economic opportunities arising from those projects, but at the same time, there are risks that need to be considered,” Giang said.

As Hanoi races to rebuild itself, residents are grappling with what that means for the communities and memories left behind.

Small changes in Hanoi’s streets can mean big disruptions for those who depend on them, as signs and awnings that have long been part of the city's street life disappear.

A citywide crackdown since November has been clearing sidewalks of illegal parking, street vendors and commercial encroachments. Police vans roam the Old Quarter in the evenings, using loudspeakers to remind vendors to remove brightly colored plastic stools that spill onto sidewalks.

Thuy, a beef noodle soup seller who gave only one name, said the four stools and tables outside her shop once allowed her to serve four additional customers every hour or so. Now she can’t and is only scraping by. “My profits are already small to begin with,” she said.

In a rare show of public dissent, residents of the Bac Cau community along the Red River hung banners “imploring” city authorities to let thousands of families remain in their homes.

The villagers fear planned roads will eventually wipe out their community.

“We want to continue to live here, we’ve been here for generations,” said Van, a local resident who gave only her first name given risks of trouble with authorities for speaking out.

Hanoi has set compensation and resettlement rules for land acquired for redevelopment projects, covering damaged structures, relocation costs and support for families moving graves.

But some residents said they had yet to receive any compensation and were uncertain about where they would live or what the future holds.

The challenge is not modernization itself, but its rapid pace and a lack of consultation with residents and experts, said Giang. It would be better, he said, to find ways to preserve the city’s history, street culture and livelihoods as it rebuilds.

Beijing, for instance, tore down most of its centuries-old city walls in the 1960s to make way for its first subway line and what is now a major ring road.

Similar redevelopment drives in China and other Asian cities have sparked disputes as residents were relocated to suburbs that often lacked basic amenities, breaking apart long-established communities.

“Once we depart from the city’s history, it’s very hard to revert or to turn back,” Giang said.

Unlike the past two decades of outward expansion through new urban areas, Hanoi’s current reconstruction is focused on reshaping the existing city, said Linh Nguyen, lead analyst at Control Risks.

This means redeveloping existing neighborhoods and relocating institutions — a far more complex task since it involves residents, property rights and compensation. The key challenge is execution, particularly land acquisition, relocation and coordination across government agencies. It's also about whether Vietnam’s increasingly centralized state can deliver projects that have been planned for decades but never carried out.

“The last 20 years were about building a bigger Hanoi. The next 20 years will be about rebuilding the Hanoi that already exists. That’s a fundamentally different challenge,” she said.

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The construction site of a new bridge crossing the Red river is seen in Hanoi, Vietnam, Thursday, June 11, 2026. (AP Photo/Hau Dinh)

A local resident sits on the ground of his demolished house, watching the demolition in his neighborhood to clear site for a new bridge crossing the Red river in Hanoi, Vietnam, Friday, June 5, 2026. (AP Photo/Hau Dinh)

A woman rides a moped past banners put up by local residents to call for stopping a project that would displace the entire village by the Red river in Hanoi, Vietnam, Thursday, June 11, 2026. (AP Photo/Hau Dinh)

This aerial shot shows a ring road being built, cutting through a residential community in Hanoi, Vietnam, Monday, June 15, 2026. (AP Photo/Hau Dinh)

A woman carries her dog as she leaves her home that has been partially demolished to build a new ring road in Hanoi, Vietnam, Thursday, June 11, 2026. (AP Photo/Hau Dinh)

SEOUL, South Korea (AP) — South Korean technology giant Samsung Electronics on Thursday reported a record operating profit of 89.5 trillion won ($62 billion) for the April-June period, a day after crosstown rival SK Hynix also reported record earnings, as the world’s two largest memory chipmakers continue to ride the global artificial intelligence boom.

Despite their soaring profits, the companies’ shares have fallen sharply this week in South Korea’s volatile stock market, where retail investors often drive sharp swings in share prices, as concerns grow over their plans to spend massively on increasing manufacturing capacity and the prospects of intensifying competition from China.

Samsung’s second-quarter operating profit was a more than 19-fold increase from a year earlier, and nearly all of it came from its semiconductor business, which benefited from rising chip prices driven by demand for AI servers and increased shipments of advanced high-bandwidth memory chips used to power AI applications. That outweighed an operating loss in its mobile, TV and home appliances division, partly due to higher component costs.

Samsung’s quarterly revenue of 171.5 trillion won ($119 billion) was also an all-time high. The company said it expects demand for its memory products to remain strong in the second half of the year, driven by continued expansion of AI infrastructure and broader adoption of agentic AI. Demand for server chips is expected to accelerate further, keeping the market undersupplied, it said in a statement.

Samsung’s report came a day after SK Hynix also reported a record second-quarter revenue of 60.5 trillion won ($42 billion). However, SK Hynx’s profit was still below the loftier market expectations and the company’s shares declined by more than 9% on Wednesday. Samsung’s share prices have also declined this week.

Kim Jaejune, an executive of Samsung’s memory chip division, said the company expects the gap between chip supply and demand to widen further in 2027. He said Samsung plans to begin construction of its second semiconductor fab in Taylor, Texas, before the end of this year, with the goal of bringing it online by 2030.

Kim said Samsung has secured long-term chip supply contracts with what he called the “five major global data center clients” — a possible reference to Amazon Web Services, Google, Meta, Oracle and Microsoft –- and is in talks with other major technology companies as demand for AI infrastructure surges.

“Despite our efforts to increase production, demand growth is outpacing our efforts,” he said in a conference call.

Samsung and SK Hynix together produce about two-thirds of the world’s memory chips. While the companies have embarked on major investments in semiconductor manufacturing facilities and data centers as South Korea expands its AI ambitions, some analysts say there are growing concerns about whether such massive spending will ultimately generate sufficient returns.

Shares of South Korean chipmakers have also been pressured by concerns over intensifying competition from China, with reports that a state-owned Chinese company had begun mass-producing domestically developed immersion deep-ultraviolet (DUV) lithography machines, a key technology for advanced chipmaking. Investor concerns were also heightened by the strong stock market debut of Chinese memory chipmaker ChangXin Memory Technologies, some analysts say.

Samsung and SK Hynix last month announced plans to invest a combined 800 trillion won ($554 billion) in a new chipmaking hub in the country’s southwest to capitalize on surging AI-driven demand.

The chiefs of Samsung, SK and South Korean automaker Hyundai joined President Lee Jae Myung on his San Francisco trip last week, where they announced hundreds of billions of dollars in planned cooperation with major U.S. technology companies, including AI firms OpenAI and Anthropic and chip designers Nvidia and Broadcom. The agreements span chip technologies, data centers and other AI infrastructure.

In a roundtable with foreign media last week, Kim Yong-beom, Lee’s chief policy adviser, said the initiatives reflect how global technology companies are rushing to secure long-term partnerships with South Korean chipmakers as they seek reliable supplies of memory chips for AI.

However, the volatility of the companies’ stock prices, along with those of other global tech firms, shows that investors are shifting their focus from short-term earnings to long-term sustainability, Son In-joon, a semiconductor analyst at South Korea’s Eugene Securities, said in a report this week.

Kim Yong-beom, South Korean President Lee Jae Myung's chief policy adviser, speaks during a roundtable with foreign media in Seoul, South Korea, Thursday, July 23, 2026. (AP Photo/Ahn Young-joon)

The logo of the Samsung Electronics Co. is seen at its office in Seoul, South Korea, Thursday, July 30, 2026. (AP Photo/Ahn Young-joon)

The logo of the Samsung Electronics Co. is seen at its office in Seoul, South Korea, Thursday, July 30, 2026. (AP Photo/Ahn Young-joon)

People pass by Samsung Gangnam store in Seoul, South Korea, Thursday, July 30, 2026. (AP Photo/Ahn Young-joon)

The logo of the Samsung Electronics Co. is seen at its office in Seoul, South Korea, Thursday, July 30, 2026. (AP Photo/Ahn Young-joon)