Thai Nguyen climbs the ranks of FDI destinations

Thai Nguyen incentivises investments with tax cuts and give support in human resources development-Photo: Viet Hung

At the end of 2012, Thai Nguyen ranked 44th in foreign direct investment (FDI) out of 63 Vietnamese cities and provinces. But in 2013, it attracted the $2 billion Samsung Electronics Vietnam’s Thai Nguyen complex (SEVT), and rose to the 17th position.

SEVT started operation in 2014. That same year, Samsung received an investment certificate to invest $3 billion into the second phase of the complex, raising its total investment capital to $5 billion. Thai Nguyen became a magnet for suppliers of Samsung too.

In the year to date, the province attracted 18 new foreign-invested projects with the total registered capital of $46.83 million, allowed seven projects to increase their capital by a combined $14.71 million. Up to now, Thai Nguyen is home to 102 foreign-invested projects with the total registered capital of $7.1 billion.

In 2015, Thai Nguyen ranked seventh out of Vietnam’s 63 cities and provinces in the Provincial Competitiveness Index (PCI) ranking. The province’s investment climate is enhanced by the efforts of the local authorities.

Chairman of the Thai Nguyen People’s Committee Vu Hong Bac, said that the province knows the most important thing in order to attract FDI is master planning – from creating a provincial master plan, to carrying it out and enforcing it.

“Investors should not be the ones to worry about site clearance,” he said.

Thai Nguyen has teams specially charged to facilitate site clearance at the district as well as provincial levels, which has been one of the top hurdles facing foreign investors in other cities and provinces. The province also incentivises investments with tax cuts, and gives support in human resources development. Administrative procedures are quick and simple because of a one-stop shop policy. The investment certificate issuance procedure in Thai Nguyen used to take 45 days – now it takes 25.

In the 2011-2015 period, Thai Nguyen’s GDP grew by an average of 12 per cent per year. In order to maintain this rate of growth and ensure its sustainability, the local authorities are trying to create an even more conducive environment for investment and business.

“To attract new investors or to encourage old investors to expand their projects, the province is going to maintain and improve its appeal,” said Bac. “Specifically, we are going to continue expanding industrial parks and increasing the quality of civil services.”

Still, according to Bac, Thai Nguyen will not just approve any FDI projects. The province plans to make high technology, manufacturing, and mining the drivers of growth in the next terms. Projects that are consistent with this plan will be prioritised, specifically those from big companies with modern technology, which meet all the standards of environmental protection.

As the country’s third-biggest education hub, with nine universities and 24 vocational colleges, the province is confident in its ability to supply investors in Thai Nguyen and nearby provinces with a skilled and educated workforce.