In recent years, Binh Duong and Da Nang have continued to solidify their positions as top destinations for Foreign Direct Investment (FDI) in Vietnam, demonstrating significant growth and resilience even amid global economic challenges.
Binh Duong: A Hub for FDI and Infrastructure Development
Binh Duong remains a major FDI destination, attracting nearly 4,300 projects valued at approximately $40.6 billion from 65 countries and territories as of May, 2024. It ranked third in Vietnam for FDI, following Ho Chi Minh City and Hanoi. In the first quarter of 2024 alone, Binh Duong secured $177 million in FDI, a 385% increase compared to the same period the previous year[1].
Infrastructure development is a key strength of Binh Duong. The province is home to advanced industrial zones, such as the Vietnam-Singapore Industrial Park (VSIP 3), which has attracted over 30 foreign companies with an estimated investment of $1.8 billion[2]. Efforts to upgrade and expand industrial park infrastructure, coupled with improvements in transportation that connect these parks with major ports and airports, enhance Binh Duong’s appeal to investors.
Vietnam- Singapore Industrial Park (VSIP 3)
Source: VSIP
Da Nang: Strategic FDI Destination with Robust Infrastructure
Da Nang continues to attract significant FDI, attracting nearly 1,044 projects valued at about $6.5 billion as of May, 2024. The city’s strategic location, comprehensive infrastructure, quality education system, proactive business environment, and high quality of life make it an attractive investment destination. Recognized as an ICT hub in Vietnam, Da Nang has been acknowledged for its investment-friendly policies and numerous awards[3].
Investment opportunities in Da Nang span various sectors, including aviation (Da Nang International Airport), maritime logistics (Lien Chieu Seaport), and logistics centers near industrial parks and seaports. The city also offers potential in hi-tech and ICT parks, healthcare facilities focusing on elderly care and specialized hospitals, and educational institutions[4].
Lien Chieu Seaport
Source: Vneconomy
Green Transition Actions
Both Binh Duong and Da Nang are actively pursuing green transition initiatives. In Binh Duong, digitalization measures include remote control systems for wastewater management in industrial parks and the establishment of a solar energy company to provide local energy.
Da Nang is investing in a waste treatment plant with a capacity of 1,000 tons per day and developing green industrial parks. The city promotes the use of solar energy and green technology and is expanding its hi-tech and ICT parks[5].
Availability of Long-Term Lease Facilities
Both regions offer a variety of long-term lease facilities, catering to diverse business needs and ensuring a smooth setup and operation for foreign enterprises.
Binh Duong: Versatile Leasing Options
Binh Duong stands out with its comprehensive range of leasing options, designed to meet the requirements of different types of investors. The province offers three main types of leasing facilities:
- Land Leasing: This option is ideal for large corporations looking to establish a significant presence. Investors can lease land to develop their own facilities, tailored to their specific operational needs. This flexibility allows for custom-built infrastructure to support large-scale operations.
- Ready-Built Factories: For businesses that need to commence operations swiftly, Binh Duong offers ready-built factories. These factories are fully equipped and meet industry standards, enabling companies to start production with minimal setup time. This is particularly advantageous for manufacturing firms looking to scale operations quickly[6].
- Leasing for Big Groups: Binh Duong also provides leasing options for large groups, offering expansive spaces that can accommodate multiple facilities. This is ideal for multinational corporations planning to establish large-scale operations or expand their existing footprint in the region.
The province’s industrial parks, such as the Vietnam-Singapore Industrial Park (VSIP), are renowned for their modern infrastructure and comprehensive amenities. These parks provide a conducive environment for both local and foreign enterprises, further bolstered by Binh Duong’s ongoing commitment to upgrading and expanding industrial park facilities[7].
Da Nang: Proactive Support for SMEs and Large Enterprises
Da Nang complements its investment appeal with a range of long-term lease facilities designed to support both small and medium-sized enterprises (SMEs) and large corporations[8]:
- Ready-Built Workshops: To facilitate the growth of SMEs, Da Nang offers ready-built workshops available for lease. These workshops provide a cost-effective and flexible solution, enabling businesses to quickly set up operations without the need for significant upfront investment in infrastructure.
- Long-Term Land Leasing: Similar to Binh Duong, Da Nang provides long-term land leasing options for investors looking to construct their own facilities. This option is particularly attractive for businesses that plan to establish a substantial and permanent presence in the city. The flexibility of designing custom-built facilities tailored to specific business requirements makes this an appealing choice for large enterprises.
Da Nang’s strategic investments in infrastructure, such as the development of logistics centers and high-tech parks, underscore its commitment to creating a favorable business environment. The city’s efforts to improve transport infrastructure and industrial park facilities further enhance its attractiveness as a long-term investment destination.
Tax Incentives
Binh Duong and Da Nang have established themselves as premier destinations for foreign direct investment (FDI) in Vietnam, thanks in part to their comprehensive tax incentives aimed at the service sector. Binh Duong offers a range of corporate income tax (CIT) incentives, including preferential rates as low as 10% for up to 15 years, tax exemptions for the initial four years of operation, and subsequent tax reductions of 50% for up to nine years. These incentives are particularly targeted at high-tech, large-scale, and socially important projects such as those in healthcare, education, and environmental protection[9].
Similarly, Da Nang provides attractive CIT incentives, including 10% CIT for the first 15 years for high-tech zone projects, along with significant tax holidays. Both cities further incentivize investment through reductions or exemptions on import duties and land rents, and additional benefits are available in their economic zones, which offer extended tax holidays and reduced rates for projects in disadvantaged areas[10].
By showcasing the strengths and opportunities in Binh Duong and Da Nang, this updated article highlights why these regions are prime destinations for foreign investment in Vietnam. The continuous development and strategic planning in these regions make them attractive and sustainable options for global investors.
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