The Economic Situation of Red River Delta Provinces After the Provincial-Level Administrative Units Mergers

23May2025

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The Red River Delta is one of Vietnam’s socio-economic epicenters, attracting investors with its dynamic growth and strategic location. Following the recent provincial-level administrative unit arrangement, which is set to take place by September 15, the region is poised to unlock new levels of efficiency, connectivity, and investment potential.

Overview of the Red River Delta after the 2025 Administrative Unit Mergers

The Red River Delta is a strategically important economic hub in northern Vietnam, comprising 11 provinces and cities. Under the provincial-level administrative restructuring outlined under Decision No. 759/QD-TTg[1], the region has 2 unchanged administrative units, Hanoi City and Quang Ninh, along with 9 provinces and cities subjected to the merger: Bac Ninh, Hai Phong City, Hai Duong, Hung Yen, Thai Binh, Ninh Binh, Ha Nam, and Nam Dinh. As a result, the region will comprise 6 provincial-level administrative units[2], including 2 centrally-governed cities.

Red River Delta’s provincial-level administrative units after the 2025 administrative mergers

Source: B&Company

The Red River Delta is one of Vietnam’s two major economic centers alongside the Southeast region, contributing roughly 30% of Vietnam’s total GDP in 2024. After the merging, the region will host several of the nation’s top-performing local economies, including Hanoi, Hai Phong, Bac Ninh, and Quang Ninh. Despite global economic headwinds, the region sustained an impressive average GRDP growth rate of over 8%, with Hai Phong alone approaching 11% growth year-over-year.

GRDP of Red River Delta provinces after the 2025 administrative mergers in 2024

No.	Provinces	Population (Unit: Thousand people)	Total Area (Unit: Km²)	GRDP (Unit: Billion VND)	Growth rate (Unit: %)
1	Hanoi City	8,718	3,360	1,426,000	6.5
2	Hai Phong City	4,103	3,195	658,381	10.7
3	Bac Ninh	3,509	4,719	439,000	9.6
4	Quang Ninh	1,397	6,208	347,500	8.4
5	Ninh Binh	3,819	3,943	268,345	9.7
6	Hung Yen	3,208	2,515	231,170	7.5
Total		24,754	23,938	3,374,396	8.2

Source: Resolution No. 60-NQ/TW, Decision No. 759/QD-TTg, General Statistic Offices (GSO), Provincial Statistics Offices, B&Company synthesis

Regional Economic Characteristics and Investment Situation of the Red River Delta

According to Resolution No. 30-NQ/TW[3], signed in 2022, the Red River Delta’s economic structure is set to become increasingly diversified, with a strong emphasis on the services sector and the industry and construction sector. While the recent administrative mergers may introduce new economic dynamics, the region’s overarching development orientation remains consistent:

(1) Developing industrial belts to drive manufacturing and regional linkages;

(2) Promoting sustainable and specialized agriculture, forestry, and aquaculture to enhance rural economies and food security;

(3) Expanding major service hubs, particularly in finance, commerce, and logistics; and

(4) Elevating tourism to a key economic sector, capitalizing on cultural heritage and natural landscapes.

In 2024, the regional services sector was valued at over 1.5 trillion VND, accounting for 45% of the regional GDP. The industry & construction sector has also seen significant growth due to the city’s shift from traditional agriculture and low-value services and the influx of foreign capital in sectors such as electronics, garments and textiles, automotive components, and logistics[4]. In 2023, the region had 73 industrial parks and export processing zones, as well as 257 industrial clusters[5], attracting global giants like Samsung, LG, Foxconn, and Canon. In contrast, agriculture, forestry, and fishing comprised less than 5% of regional GDP. This sector is transitioning toward high-tech, large-scale production zones, focusing on key agricultural products, industrial livestock farming, and aquaculture tied to value-added branding.

GRDP Composition of the Red River Delta in 2024

Unit: %

Source: General Statistic Offices (GSO), Provincial Statistics Offices, B&Company synthesis

The GRDP composition of Red River Delta provinces following the administrative mergers offers deeper insight into the region’s geo-economic landscape. Hanoi City stands out as a leading services hub, driven by its centralized financial system, expanding retail sector, and fast-growing tourism industry that attracts both domestic and international visitors[6]. On the other hand, Bac Ninh, after the merger with Bac Giang, had the highest share of the industry & construction sector in its regional GDP composition in 2024 at 69%. While industry and construction dominate much of the region, coastal provinces such as Hai Phong, Quang Ninh, and Ninh Binh display a more diverse economic structure, with higher contributions from services and agriculture–forestry–fishing sectors, benefiting from their strategic position for marine economy, logistics, and tourism development.

GRDP composition by provinces in the Red River Delta post mergers in 2024

Unit: %

Source: General Statistic Offices (GSO), Provincial Statistics Offices, B&Company synthesis

The post-merged Red River Delta continues to be one of Vietnam’s leading regions in attracting foreign direct investment (FDI), thanks to its strategic location, developed infrastructure, and industrial ecosystem. In 2024, the Red River Delta accounted for 55% of Vietnam’s total registered FDI, with investment flows concentrated in high-tech manufacturing and supporting industries. Bac Ninh led with 6.4 billion USD in FDI, followed by Hai Phong City with 5.8 billion USD, while Hanoi recorded the highest number of FDI projects, totaling 7,600.

New registered FDI capital in 2024 (Left) and Total accumulated registered FDI capital in 2024 (Right) by provinces of the Red River Delta

Unit: Billion USD

Source: MPI, B&Company synthesis

Potential Changes in Economic Development Orientation of Red River Delta Provinces Following Administrative Unit Mergers

The recent administrative unit mergers in the Red River Delta mark a significant turning point in the region’s economic geography. While Hanoi and Quang Ninh remain unchanged due to their established economic identities and administrative sufficiency, other provinces are undergoing major consolidations that could reshape local economic strategies, diversify the economic base by incorporating new elements from neighboring provinces, or further amplify existing regional strengths.

Economic landscape and the development orientation of Red River Delta provinces after merging

Provinces	Economic landscape	Possible economic development orientation
Hanoi	While unchanged, Hanoi remains the center of Northern Vietnam’s economy, playing a vital link in 4 out of 5 economic corridors. The growth of Hanoi’s economy will further be amplified as surrounding localities grow in economic size and connectivity	· Promoting trade, logistics, finance, and sustainable tourism; · Developing high-tech and circular industries; · Advancing high-tech agriculture.
Hai Phong City Merged from: · Hai Phong City; · Hai Duong.	The merger improves the sea logistics of Hai Phong City with Hai Duong’s inland structure. It creates a synergized logistic infrastructure connecting with the regional industrial hubs	· Prioritizing high-tech manufacturing sectors, including electronics, machinery, automotive, etc. · Developing seaport and logistics services; · Developing sea economy.
Bac Ninh Merged from: · Bac Ninh; · Bac Giang.	The merger creates a mega-industrial province, connecting the established industrial ecosystem in Bac Ninh to the labor markets and industrial land in Bac Giang	· Developing high-tech manufacturing and processing industries, fueling by foreign investment capital
Quang Ninh	While unchanged, Quang Ninh has a diversified economic structure, with a strong sea economy, tourism, and logistics. The merger gives Quang Ninh a better connection with the Red River Delta’s economy while growing its sea economy with other coastal provinces	· Developing high-tech manufacturing and processing industries; · Promoting green industries and green energy sectors; · Strengthening the logistics industry, elevating tourism to a key economic sector; · Developing sea economy.
Ninh Binh Merged from: · Ha Nam; · Nam Dinh; · Ninh Binh.	The merger creates a balanced economic zone with Ha Nam’s industrial and logistics growth, Nam Dinh’s traditional manufacturing, and Ninh Binh’s tourism economy and agricultural resources	· Developing sustainable tourism centering its heritage network; · Prioritizing high-tech manufacturing sectors; · Attracting foreign investment.
Hung Yen Merged from: · Hung Yen · Thai Binh.	The merger extends the economic base of Hung Yen with the marine economy, agriculture, and renewable energy of Thai Binh while strengthening its industry sector	· Developing industrial belts near Hanoi City, focusing on high-tech industrial sectors; · Expanding industrial zones toward coastal areas; · Developing sea economy in connection with other coastal localities.

Source: Economic planning of Red River Delta provinces, B&Company synthesis

Conclusion

The recent administrative mergers in the Red River Delta signal a strategic effort to enhance regional coordination, optimize resources, and boost economic growth. While Hanoi and Hai Phong continue to lead in services, logistics, and high-tech industries, the newly formed provinces are emerging as dynamic growth centers with diverse strengths, from manufacturing and agriculture to tourism and renewable energy. For foreign investors, this transformation offers expanded opportunities in a region that is becoming more integrated, efficient, and investment-ready.

[1] TVPL. Decision No. 759/QD-TTg approving the Proposal on Reorganization of Administrative Units at Various Levels and the Construction of a Two-Tier Local Government Structure <Source>

[2] For the analysis purposes under this article, we excluded Vinh Phuc in the regional analysis as the province will be merged with Phu Tho and Hoa Binh, two provinces from the Northern Midland and Mountainous region. We also included Bac Giang as the provinces is set to be merged with Bac Ninh.

[3] TVPL. under Resolution No. 30-NQ/TW on the Socio-Economic Development and Ensuring National Defense and Security in the Red River Delta Region by 2030, with a Vision to 2045 <Source>

[4] Economy & Forecast Review. Promote regional advantages and accelerate the restructuring of economic sectors in the Red River Delta <Source>

[5] GSO. Vietnam Statistical Yearbook – 2023 <Source>

[6] Economic & Urban Development. Hanoi: Retail Sales of Goods and Consumer Service Revenue Increase by 8.6% <Source>

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