Obvious changes in investment environment

The investment environment in some provinces and cities has improved significantly. Many administrative procedures, especially those related to businesses and investment have been simplified to help shorten processing time.

Some localities have issued a special mechanism, authorising a specific agency to handle all investment procedures at the one-stop shop division, so investors only need to contact this division to meet their needs. These changes have created confidence for investors, attracting resources for socio-economic development.

Less than a month after the Government approved in principle the investment in the construction of Dong Anh Industrial Park in Hanoi, the People’s Committee of Hanoi granted the investment certificate to the investor, Vietnam Construction and Import-Export Corporation (Vinaconex), in April 2024.

Shortening time to process procedures

In recent years, Hanoi has drastically improved the investment environment and shortened the time to resolve procedures by simplifying administrative procedures, especially in business and investment fields. Vice Chairman of the municipal People’s Committee Ha Minh Hai, said the city issued 76 documents related to the management and reform of administrative procedures and digital transformation in 2023 and the first three months of 2024.

In Hai Phong, the city issued a special mechanism authorising an agency to handle all investment procedures at the one-stop shop division. Deputy Head of the Hai Phong Economic Zone Management Board, Bui Ngoc Hai, said that investors only need to contact the Economic Zone Management Board to conduct all procedures on the environment, construction certificate and others. With the coordination mechanism between the Economic Zone Management Board and related agencies, such as the Department of Planning and Investment, Tax Department, and Customs Department, investors will quickly be granted business registration certificates, tax codes, and so on, immediately after receiving an investment certificate.

Thai Nguyen Province has witnessed strong changes in the investment environment in recent years, becoming a typical locality in attracting FDI in the Northern midlands and mountainous regions. Deputy Head of the Management Board of Thai Nguyen Industrial Parks, Tran Quoc Trung, said the board received more than 1,000 applications in 2023, and 100% of applications were handed in ahead of schedule or on time. In particular, the time for granting investment certificates was shortened, down seven days compared to regulations, the time for adjusting investment certificates was reduced by four days and the issuance time of construction permit is 15 days, a cut of five days.

The creation of favourable conditions for investors and the shortening of processing time for administrative procedures, make businesses feel confident to continue increasing investment capital and expanding production scale. According to the leader of China’s Trina Solar Group, a large investor in Thai Nguyen, the group completed all investment procedures for the third project in Yen Binh Industrial Park in a very short time, with a total registered capital of over 454 million USD, raising the total investment capital of the group in Thai Nguyen to more than 930 million USD, to produce solar energy equipment.

Also in a short time, the authorities of Thai Nguyen Province completed procedures for infrastructure construction of the second phase of Song Cong II Industrial Park, with a scale of nearly 300 ha and an investment capital of 3.99 trillion VND. As a result, the project is scheduled to commence in October 2024, two months earlier than planned.

Chilisin Electronics Vietnam invested in an electronic components factory in VSIP Hai Phong Industrial Park in 2015, deciding to increase investment capital by 73.7 million USD to produce and process electronic components to supply for Samsung and Apple, increasing the company’s total investment capital to 170.2 million USD. Deputy General Director of Chilisin Vietnam, Liao Yun Hoan, said that preferential investment policies along with a safe social environment and strong improvement of the business investment environment in Hai Phong, are the solid basis for businesses to decide to expand production scale.

In addition, Hai Phong has also boosted investment promotion programmes in several key countries, such as the US, Japan, and the Republic of Korea (RoK), bringing about remarkable results. At the investment promotion programme in RoK, businesses signed cooperation agreements with a committed investment of up to 1.5 billion USD. In just six days, the Standing Committee of Hai Phong City Party Committee issued a document approving the investment policy, and just one day later, the city issued an investment certificate for LG Innotek to increase capital by 1 billion USD.

Continuing to remove bottlenecks

Although the investment environment has seen many changes, investors still encounter some difficulties when implementing projects in localities. In Hanoi, many investors reported that land clearance for many projects still faces obstacles, causing project delays. A representative of Dai Phong Infrastructure Construction JSC, the investor of Xuan Thu Industrial Cluster in Soc Son District, said land clearance to build the industrial cluster is being postponed due to a lack of consensus from many households and insufficient land management records of the site clearance area.

In industrial centres, there are few land funds left for industrial development. Meanwhile, some infrastructure construction projects for industrial clusters, residential areas, urban areas, and transportation lack fill materials.

Director of the Thai Nguyen Department of Planning and Investment, Ha Van Duong, said the province completed legal procedures to approve the building of industrial parks, with a total area of more than 3,000 ha. It also got approval to build the infrastructure of Song Cong II Industrial Park (phase 2). In addition, the Provincial People's Committee also agreed in principle the investment in more than 10 industrial clusters to create land funds for industrial development in the near future.

In addition, at the end of 2023, Thai Nguyen Province auctioned the mining rights of 22 land mines in its localities to handle the shortage of fill materials for construction projects.

Hai Phong also focuses on establishing a coastal economic zone in the south of the city, to have more space for investment projects. In particular, the city aims to form a Free Trade Zone, a deep-water port south of Do Son, and Tien Lang Airport. Hai Phong is also accelerating the construction of the new industrial parks of Nam Trang Cat, Trang Due 3, and Giang Bien 2.

In addition, many provinces and cities have raised investment in inter-regional or sub-regional transportation systems. Hanoi is coordinating with Hung Yen and Bac Ninh provinces to speed up the construction progress of Belt Road 4 to put it into operation by the end of 2025. Hai Phong is accelerating the progress of the Ben Rung Bridge and Lai Xuan Bridge connecting with Quang Ninh Province. Meanwhile, Thai Nguyen is urgently constructing Belt Road 5 while the road linking Thai Nguyen, Bac Giang and Vinh Phuc is expected to be completed by the end of 2024.