Bac Ninh Province - A Successful Location for FDI Enterprises

5:28:00 PM | 13/6/2006

Japan’s Canon, the world-leading printer producer, believes Bac Ninh Province would be a promising investment place as it set its foot in Vietnam. Vietnam Floating Glass Co. Ltd (VFG), another Japanese firm, is also an exemplary business in this country. Previously, construction glass was mainly imported from China but when VFG invested more than US$100 million to build its factories in Bac Ninh, local constructors ceased worrying about the supply of this special material. 
In 2005, Canon decided to invest US$60 million to build a camera production plant in Bac Ninh for export. The presence of Canon increased incomes as well as experience in highly-levelled worker management and training for Bac Ninh Province. Mr. Ngo Sy Bach, Deputy Director of Bac Ninh Provincial Department of Planning & Investment, said: The success of the first phase has opened a new phase for the project. In the second phase, Canon will invest a further US$100 million and when it becomes operation, the annual export revenues may reach US$1.6 billion. If this project, which is being considered by competent bodies, is realised, Bac Ninh will make a breakthrough in FDI attraction in the state of being a Red River Delta province.
In late May 2006, the Vietnam Chamber of Commerce and Industry (VCCI) and USAID-sponsored project VNCI, announced Bac Ninh is one of few northern localities to have high-ranked provincial competitive index (PCI). Bac Ninh ranked 22th out of 64 provinces and cities in 2006, jumping from the average level to mid-high level. Mr Vu Tien Loc, Chairman of VCCI, said: The PCI can be considered a good opportunity to assess the local business environment. To this end, Bac Ninh is an attractive place for domestic and international investors.
FDI attraction results:
With the target of becoming an industrialised province by 2015, Bac Ninh defined FDI capital sources to play an important role. With this policy, in the 2001-2005 period, Bac Ninh Province issued a lot of incentive policies to persuade investors to seek opportunities and invest in. During the five-year period, the province attracted 34 FDI projects with a combined registered capital of US$134 million. 26 projects valued US$114 million are housed inside industrial parks and eight others are outside industrial parks. China, South Korea, Taiwan, Japan, Singapore, Brunei and the US have the most investors.
Among 34 FDI projects, eight are joint ventures with a total registered capital of $9.5 million while 26 are wholly foreign-invested projects valued US$124.5 million. In general, foreign capital makes up the majority while the Vietnamese side contributes a tiny proportion in these projects
FDI projects’ business results in 2001-2005
estimated 2005
Prov. Total budget collection
FDI sector
Total export value
FDI sector
FDI sector workforce
Lao Ä?á»ng
Source: Bac Ninh Statistics Office
Developing favourable IPs-EPZs:
Currently, Bac Ninh Province has three large-scaled industrial parks, including the 600-ha Tien Son IP, 436-ha Que Vo IP and 230-ha Daoi Dong-Hoan Son IP. The province has no export-processing zone.
As of August 2005, these IPs housed 26 FDI projects with a total investment capital of US$144.5 million. Particularly, Que Vo IP had eight projects valued US$81 million, Tien Son IP 16 projects worth US$27 million and Dai Dong-Hoan Son IP two projects with a compounded registered capital of US$4 million.
Increasing administrative formality reform and personnel training
Bac Ninh Province has applied the “one-door” policy in administrative procedure resettlement. The Department of Planning & Investment has applied the one-door policy in investment licensing activities, swiftly resolving all difficulties after licenses granted and creating the most favourable conditions for investors to execute projects in the soonest time. The department has also created an easy business environment.
Bac Ninh Industrial Park Authority, which is responsible for managing IPs in the province, has also applied “one door” policy in investment licensing and resolving post-licensing difficulties to help investors improve business operation. The “one door” policy helps minimise troubles for organisations and individuals.
The Department of Planning and Investment and IP Authority have appointed FDI management cadres in charge at the provincial office. These officials have high command of profession and have been trained of investment promotion profession by the Ministry of Planning and Investment and other relevant bodies.
Attracting bigger projects
After five years of implementing the Government’s policy and guidance in increasing FDI attraction and improving FDI efficiency, Bac Ninh has made certain achievements on this sphere. The FDI sector contributes to the overall social and economic development of the province and plays a crucial role in generating high growth rate and socio-economic stability. The FDI sector has paid taxes and other duties to the State Budget although the volume is still small. However, this sector will make bigger contributions in the coming time and is employing thousands of locals.
Nonetheless, FDI inflows into Bac Ninh Province are unstable, mainly small and medium projects. The province has not successful in attracting big projects with advanced technologies. With its favourable location and transport system, Bac Ninh is confident that it can attract bigger projects.


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