Hai Phong – a bright spot in attracting foreign investment

The Politburo’s Resolution 45 and the resolution of the 16th Hai Phong City Party Congress for the 2020-2025 term both identify the goal of building and developing Hai Phong into a modern, smart and sustainable industrial city on par with Southeast Asian cities, in which FDI enterprises play an important role in its industrial production development.

FDI on the rise

Statistics from the Hai Phong Economic Zone Authority (HEZA) show that the port city currently ranks among the six largest FDI recipients, with 1,000 projects from 40 countries and territories.

The Republic of Korea is the largest foreign investor in Hai Phong with 11.8 billion USD, accounting for 45% of total investment capital. Japan ranks second with 3.5 billion USD, followed by Singapore with 3 billion USD. The Dinh Vu-Cat Hai Economic Zone alone has attracted 26.2 billion USD, accounting for more than 80% of the total FDI in the city.

Introducing LG's advanced manufacturing technology in Hai Phong

HEZA Director Le Trung Kien shared that foreign-invested enterprises in Hai Phong’s industrial parks and the Dinh Vu-Cat Hai Economic Zone have brought the occupancy rate there to over 70%. Additionally, Hai Phong’s average investment per hectare has reached approximately 13 million USD, more than three times the national average, making an important contribution to Hai Phong’s economic growth.

At the same time, FDI enterprises account for nearly 90% of the city’s total import-export turnover, contribute 12-18% of total local budget revenue, and have created jobs for nearly 250,000 workers, accounting for more than 40% of the total workforce across all business sectors.

Notably, through FDI projects, the city’s management capacity and worker skills have been increasingly improved in accordance with international standards, creating a spillover effect into other sectors of the economy.

Choi In Kwan, General Director of LG Display Vietnam, said that LG’s subsidiaries, as well as other FDI enterprises, always receive attention and favourable conditions from Hai Phong’s leadership. This is also among the reasons why LG has chosen to invest and expand its business in the city.

To date, LG’s total investment in Hai Phong has reached over 8 billion USD, with three major companies — LG Electronics, LG Display, and LG Innotek — employing about 35,000 workers. Additionally, the company always strives to build a safe working environment and actively implements community and social welfare activities with the desire to contribute more to local development.

Continued strong development

FDI capital has affirmed its increasingly important role in Hai Phong’s economic development, currently accounting for about 30-50% of the city’s total annual development investment capital. The proportion of foreign investment capital in the city’s total economic output has increased over the years and now accounts for more than 26%.

During his meeting with the city leaders in mid-November, General Secretary To Lam requested that Hai Phong strive to develop on par with notable Asian cities to become a modern international port city, leading the country in industrialisation and modernisation efforts, and establishing itself as an international centre for economics, education, training, and science-technology, where people’s material and spiritual lives are continuously improved, as outlined in the objectives of the Politburo’s Resolution 45.

In response to the Politburo’s requirements, Hai Phong must better plan and prepare for the future and remain determined to pursue these goals. For the city to succeed, it must have a wise development strategy, excellent governance and the trust of its people. The people’s trust is the greatest asset and motivation.

Regarding its future development direction, General Secretary To Lam demanded that Hai Phong must aim to become a city of innovation, creativity, and entrepreneurship. He encourages increased spending on research and development, promoting inventions and patents, protecting property rights in an effective manner, and creating an attractive environment for creativity and startups.

Furthermore, the city needs a good strategy in selecting and attracting FDI and promoting technology transfer, creating all conditions for domestic enterprises to develop and participate in international supply chains, with the aim to build an independent, self-reliant, and integrated economy with a spirit of self-reliance and international competitiveness.

In particular, the city focuses on accelerating the establishment and expansion of industrial parks and economic zones, especially the establishment of the Southern Coastal Economic Zone — a new driving force for the city’s economic development which serves as a “nest” for high-tech FDI enterprises and attracting sustainable capital flows.

The increasingly rapid attraction of FDI capital in recent years has demonstrated the strong innovation in thinking, awareness, action and vision of Hai Phong’s leaders in investment promotion, site clearance, development of industrial park infrastructure, connecting transportation infrastructure, and creating an attractive and friendly business investment environment.

Choi In Kwan, General Director of LG Display Vietnam affirmed that Hai Phong is an ideal city for businesses and a place with excellent human resources with good infrastructure systems, such as seaports and international airports.

Notably, the city leadership’s business-friendly administrative capacity towards FDI enterprises is remarkable. Businesses were extremely impressed when city leaders directly visited sites and provided timely direction to quickly overcome the consequences of Typhoon Yagi.

Additionally, HEZA is also a reliable address, providing timely support to resolve all investment and development obstacles. Businesses have shown their trust in the Government of Vietnam in general and Hai Phong City in particular in their choice and decision to continue investing.

Chairman of Hai Phong People’s Committee Nguyen Van Tung has pledged that the city will continue to focus on attracting FDI, especially semiconductor projects and selecting large reputable investors from around the world.

The city will create the most favourable conditions for investors following the motto that “the success of businesses is the success of the city”, while strengthening linkages between FDI enterprises and Vietnamese businesses to participate in global supply chains, creating momentum and prerequisites for the city’s development, and contributing to the country’s strong and steady advancement in a new era — the era of the nation’s rise.