Hung Yen Province Creates Favourable Business Environment for Investors

Hung Yen Province Creates Favourable Business Environment for Investors

In the course of national industrialization and modernization, Hung Yen province is striving to become an industrial province by 2020. Towards this end, the province has created a favourable business environment to become an attractive destination to both domestic and foreign investors.

Lying adjacent to Hanoi and having roads leading to Quang Ninh and Hai Phong seaports, Hung Yen enjoys various advantages of investment attraction. However, according to Mr. Nguyen Bat Khach, Vice-chairman of Hung Yen Provincial People’s Committee, the most important appeal to investor is its liberal investment policy. From the very beginning, the province has adopted the one-stop-shop mechanism, authorizing the Provincial Department of Planning and Investment to receive and process procedures of investment license for enterprises. The province has proactively allocated land funds and essential facilities before calling for investment. Therefore, 8 years after its formation, Hung Yen province has witnessed a rapid industrial growth rate. The number of investment projects has increased from 7 in the early years to 350 with total registered capital of more than USD1 billion. A number of industrial zones (IZ) have been established, including Nhu Quynh A IZ, Nhu Quynh B IZ, Pho Noi A IZ, Pho Noi B IZ, Minh Duc IZ, and Hung Yen Town IZ. Furthermore, new and emerging industrial parks and clusters will soon be developed in the province’s southern districts like Khoai Chau, Kim Dong, An Thi, Tien Lu and Phu Cu. These investment projects have contributed to the sharp increase of the industrial output from VND355 billion to VND6000 billion. The industrial output in foreign-invested sector has reached VND2,502 billion, accounting for 42% of the province’s total industrial production and significantly contributing to the transformation of the province’s economic structure towards the rapid increase of industrial, service and construction proportions.

According to a report by Hung Yen Provincial Department of Planning and Investment, the projects under operation have created various production lines and hi-tech sectors with abundant and diverse products. A number of products meeting the ISO 9001 and ISO 9002 standards are highly competitive in domestic and international markets. Foreign-invested projects represent an important dynamism for the province to enhance its capital, management, technological and marketing capabilities, positively contributing to the course of industrialization and modernization, generating jobs for a large number of local workers and increasing the revenues for the local State budget from VND66 billion to VND900 billion in 2004).

Realizing the importance of foreign direct investment (FDI) projects to the local socio-economic development, the province’s Party committees and authorities at all levels have created a favourable business environment for foreign investors. According to Mr. Doan Anh Quan, Deputy Director of the Provincial Department of Planning and Investment, the investment incentives offered by Hung Yen are no different from other provinces; Hung Yen, however, attaches greater importance to creating a transparent, open and favourable environment for investors. At present, the province has promulgated the regulation on investment incentives for projects undertaken in local IZs, processing and export zones, and hi-tech parks, including infrastructure building projects and production expansion projects. Under this regulation, the province will undertake the construction of technical facilities in the vicinity of IZs as well as enhance the social infrastructure for IZs’ sustainable development. The province offers land rental at the lowest level provided by the Ministry of Finance to local IZ infrastructure development companies. These companies are exempt from rental tax in accordance with the Government’s relevant regulation applied to Hung Yen province, and entertain other incentives under applicable laws. With regard to enterprises in IZs leasing IZ land with available premises and technical infrastructure, related IZ infrastructure development companies will re-assess the cost of IZ land lease to include net land rental. The investment projects that employ more than 100 local labourers will be supported with 50% of the training cost per employee. Moreover, enterprises are entitled to exemptions and reduction of corporate revenue tax, personal income tax and import & export tax. Investors in IZs enjoy a 50% discount of advertisement costs on the province’s mass media within two years of entry into operation. The province also greatly facilitates enterprises in enhancing commercial exchanges, participating in workshops, exhibitions and expositions, and expanding domestic and international markets.

• Thu Huyen