Bac Ninh welcomes smartphone plant

The northern province will welcome Microsoft’s second smartphone manufacturing plant

The group’s leaders recently met provincial officials in Singapore, saying that Microsoft would expand its existing $302 million mobile phone production factory in the province’s Vietnam-Singapore Industrial Park.

“Microsoft will triple its employees from 5,000 where it currently stands to 15,000 in the near future,” Deputy Chairman of the Bac Ninh Provincial People’s Committee Nguyen Van Nhuong told VIR. “The total additional investment capital has yet to be revealed, but it will be very big. Microsoft is aiming to employ an additional 500 new workers every week.”

Nokia Vietnam opened the plant in October 2013. The factory was acquired by Microsoft in April this year.

Nhuong said Microsoft would gradually narrow its mobile phone manufacturing in Hungary, China and Mexico and relocate production lines to Vietnam.

According to the committee, Microsoft will also apply state-of-the-art environmentally-friendly technologies. With its sizable investment and high technology, that group will be entitled to a 10 per cent corporate income tax exemption for the first four years of operations and a 50 per cent reduction for another nine years. This incentive is in line with the government’s incentives for hi-tech projects. Samsung also enjoys this incentive.

“Additionally, based on its own incentives for these projects, the province will give another a 50 per cent reduction for another four years to Microsoft,” Nhuong said. “We highly value this investment.”

Nhuong said Microsoft would support the province in producing skilled workers and developing e-government.

Nhuong also said the province was deploying many investment promotion programmes to attract foreign firms operating in the supporting industries, thanks to Samsung and Microsoft’s presence in the province.

In 2009, Samsung inaugurated a $670 million Samsung Electronics Vietnam (SEV) factory to produce mobile phones in Bac Ninh. After that, the total investment capital was raised to $2.5 billion.

In March 2014, Samsung started operations of its $2 billion hi-tech complex in the northern province of Thai Nguyen, on an area of 100 hectares. It exported nearly $2 billion in smartphones and tablets, totalling six million units by the end of June, just three months after starting production.

SEV’s exports in 2013 were valued at $23.9 billion. Together the two factories are expected to achieve an export value of $35 billion this year.

Early this month, Samsung also received an investment certificate from Ho Chi Minh City’s authorities for construction of another $1.4 billion electronics manufacturing complex in the city.