Vietnam quit as host of the 2019 Asian Games on Thursday, citing a lack of preparedness and concerns that holding the multi-sport event would not prove financially viable.
Prime Minister Nguyen Tan Dung said Vietnam was suffering from the effects of global recession and the state was unable to foot the bill for facilities and venues that would not be profitable in the years after the Games.
It was not immediately clear which country would take over from Hanoi as hosts of the 18th Asian Games.
"We've only heard about it and we are waiting for a formal communication from the Vietnam Olympic Committee," Randhir Singh, secretary general of the Kuwait-based Olympic Council of Asia, told Reuters.
"Once we receive that, we'd be in a better position to comment on it.
"It's too premature to talk about new possible venues. There is a procedure but first we have to wait for confirmation from Vietnam that they have withdrawn."
Dung held a crisis meeting with top officials on Thursday and concluded it was better to opt out now, because poor preparation could damage Vietnam's reputation.
"Hosting this could help us promote our economy, society and the country's image. However, if we did not prepare carefully and successfully, it could have the opposite effect," Dung said in a statement posted on the government's website on Thursday.
"State budget is limited and has to be focused on investing in other very urgent tasks."
Economists' estimates for the cost of Vietnam hosting the Games have varied from $150 million to as high as $500 million.
Hanoi, the Vietnamese capital, was awarded the Games in November 2012, ahead of the Indonesian city of Surabaya. Incheon in South Korea will host the event this year.
Though Vietnam's $155 billion economy is in recovery and annual growth of more than five percent is expected in the next few years, it faces many deep-rooted problems, including weak infrastructure, one of Asia's highest levels of bad debt and a state sector mired in graft and inefficiency.
The Asian Games, which was held for the first time in 1951, typically features about 40 sports and is attended by athletes from 45 countries.
It combines traditional sports like athletics, swimming, cycling and boxing with Asian disciplines that include sepaktakraw, wushu and kabaddi.