FDI into Vinh Phuc Province Rising Sharply

11:26:01 AM | 12/3/2021

Overcoming the difficulties and impacts of the COVID-19 pandemic, Vinh Phuc province has not only obtained significant achievements in economic growth and budget revenue, but also continued to assert itself as a favored destination for investors.

According to statistics from the Department of Planning and Investment of Vinh Phuc province, in the context of the outbreak of the pandemic, the attraction of foreign investment in the province remained at a positive level. The foreign investment flows into Vinh Phuc in three quarters increased by nearly 220% over the same period and exceeded the plan by nearly 150%.

Maximum support for investors and businesses

By the end of October, Vinh Phuc attracted 426 FDI projects with a total registered investment capital of US$7.1 billion; 822 DDI projects with a total investment capital of more than VND106.4 trillion. The investment projects came from 20 countries and territories, including 15 projects of European investors, accounting for nearly 3% of total registered FDI capital, operating mainly in the high-tech manufacturing industry, supporting industries, production of automobiles and motorcycles, and animal feed. In particular, in the context of the pandemic, thanks to the timely support policies of the Government and the province, European enterprises, including Piaggio Vietnam Co., Ltd (Italy), North Stair Precision Co., Ltd (USA), De Heus Co., Ltd (the Netherlands), still managed to develop production and business activities, making an important contribution to local budget revenue.

Vinh Phuc has become an attractive destination for investors thanks to three factors namely geographical location, favorable natural conditions; quality of technical infrastructure and services to support investors of industrial parks. The province has prepared 500 hectares of clean land to accommodate investors. The authorities at all levels have promptly removed difficulties and obstacles for investors. In particular, in the context of the COVID-19 pandemic, the province has aggressively prevented the pandemic to ensure safe production and business activities and given priority to vaccination for experts and workers.

Mr. Le Duy Thanh, Chairman of Vinh Phuc Provincial People's Committee, said: "We have developed many policies. One of the most important policies to create confidence for foreign investors is combating the pandemic well and providing the best conditions for investors who are investing in the province."

Provincial leaders often had working sessions and dialogues with businesses. At the end of July 2021, the province established a working group to assist the Chairman of the Provincial People's Committee to remove business difficulties. At the same time, it built a new investment process, reducing by about 20% the time to handle administrative procedures; and strengthening online administrative procedures to help foreign-invested enterprises that could not go directly to carry out investment procedures in the context of the COVID-19 pandemic. According to statistics, after more than two months of operation, the working group received and quickly resolved nearly 1,000 phone calls from businesses, mainly asking the province to remove difficulties in immigration of experts, the circulation and transportation of goods, and transportation of workers from other provinces.

Diversifying investment promotion activities

Not only doing well on the spot investment promotion, the province has also carried out many investment promotion activities aimed at major countries' markets. At the end of June 2021, the People's Committee of the province collaborated with the Italian Chamber of Commerce in Vietnam (ICHAM), the Embassy of Vietnam in Italy to organize a webinar with Tuscany, Italy with the theme: “Vietnam: race, dream, challenge - The Asian nation's opportunity in light of the recent Free Trade Agreements with the European Union”. At the end of October 2021, the Provincial People's Committee coordinated with the German Chamber of Industry and Commerce in Vietnam to organize the Seminar "Promoting investment and business cooperation between Vinh Phuc, the Federal Republic of Germany and Europe".

In order to attract large investors from Europe and the United States, Vinh Phuc will continue to innovate investment attraction activities, and ensure harmony between the interests of the state, investors and the people. It will focus on new investment in the direction of increasing the content of technology and technical labor. The province will prioritize industries that are embracing the industrial revolution 4.0 such as: ICT industry, nanotechnology, biotechnology, new environment-friendly materials, making great contributions to socio-economic development; projects capable of participating in global value chains. The province will focus on projects in the fields of electronic industry, telecommunications, mechanical industry, building materials, new materials and supporting industries of the manufacturing and assembling industries of automobiles, motorcycles and electronics; industrial park infrastructure development, tourism service, and world-class universities. The priority areas will also include service industries such as finance, banking, insurance, healthcare, education - training. The province will focus on attracting investment projects in industrial parks, improving occupancy rates in industrial parks. It will attach industrial development to environmental protection; thoroughly deal with the environmental pollution in industrial parks and clusters; gradually form regional industrial centers and encourage the attraction of supporting industry projects of the manufacturing and assembling industries of automobiles, auto parts and motorcycles.

In addition, Vinh Phuc province will also apply many special preferential policies for investors and businesses, including applying the corporate income tax rate of 10% for a period of 15 years to software manufacturing, renewable energy and clean energy. Or, depending on the industry or project, businesses can apply tax exemption, corporate income tax reduction from 2 to 4 years and 50% reduction of payable tax from the next 4 to 9 years. It will offer exemption or reduction of land tax and ground rent for some cases.

By Le Hien, Vietnam Business Forum