1. Overview of the development of industrial parks in Vietnam

Industrial parks in Vietnam play a vital role in the country’s economic development. Since the establishment of the first industrial park in Ho Chi Minh City in 1991, Vietnam’s industrial park construction has experienced rapid development. By the end of 2023, more than 400 industrial parks have been built and put into operation in 61 provinces and cities, with a total planned area of ​​about 120,000 hectares. These parks have not only become an important carrier for attracting foreign direct investment, but also a key engine for promoting Vietnam’s industrialization and modernization process.

There are various types of industrial parks, including traditional manufacturing parks, high-tech parks, export processing zones, special economic zones, etc., covering a wide range of fields from labor-intensive industries to high-tech industries. Among them, the Hanoi-Haiphong-Quang Ninh Economic Corridor in the north, the Da Nang High-tech Zone in the middle, and the Ho Chi Minh City-Dong Nai-Bingyang Industrial Belt in the south have become the most representative industrial agglomeration areas in Vietnam. These parks have played a huge role in attracting investment, creating jobs, promoting technological innovation and promoting regional economic development.

In recent years, the development focus of Vietnam’s industrial parks has gradually shifted from quantitative expansion to quality improvement, with more emphasis on industrial upgrading, environmental protection and sustainable development. The government actively promotes the construction of “green industrial parks”, encourages the development of high-tech industries and high value-added industries, and strives to enhance Vietnam’s position in the global value chain.

2. Importance and purpose of preferential policies

In the rapid development of Vietnam’s industrial parks, preferential policies have played a key role. The importance and purpose of these policies are mainly reflected in the following aspects:

Attracting foreign investment:Preferential policies are an important tool for Vietnam to enhance its international competitiveness and attract foreign investment. By providing tax exemptions, convenient land use and other preferential policies, Vietnam can stand out in the fierce global investment competition and attract multinational companies and foreign investors.

Promoting industrial upgrading:The special preferential policies for high-tech industries and strategic emerging industries are aimed at promoting the optimization and upgrading of Vietnam’s industrial structure and the transformation from labor-intensive to technology-intensive.

Balanced regional development:By implementing differentiated preferential policies for different regions, the Vietnamese government strives to promote economic development in underdeveloped areas and narrow regional development gaps.

Supporting the growth of local enterprises:The preferential policies are not only aimed at foreign-funded enterprises, but also provide support to local small and medium-sized enterprises to help them grow and develop in the competition with multinational corporations.

Job Creation and Technology Transfer:By attracting investment and encouraging enterprise development, preferential policies have indirectly promoted job creation and technology transfer, and improved Vietnam’s overall industrial technology level.

Enhance international competitiveness:In the context of globalization, preferential policies are an important means for Vietnam to participate in international competition and integrate into the global industrial chain.

Addressing economic challenges:Faced with global economic uncertainties and various challenges, flexible preferential policies have become an effective tool for the Vietnamese government to regulate the economy and respond to crises.

In general, the preferential policies for Vietnam’s industrial parks are a complex and comprehensive system covering taxation, land use, financing support and other aspects. These policies not only reflect Vietnam’s determination to attract investment, but also reflect the country’s industrial development strategy and the direction of economic transformation. Understanding and grasping these preferential policies is crucial for investors to make wise investment decisions, and is also an important measure for Vietnam to continuously optimize its business environment and enhance its international competitiveness.

In the following chapters, we will analyze in detail the specific preferential policies of Vietnam’s industrial parks to provide investors with comprehensive and in-depth reference information.

3. Tax Preferential Policies

The tax incentives in Vietnam’s industrial parks are an important means of attracting investment, mainly involving corporate income tax (CIT), value-added tax (VAT) and import and export taxes. These policies vary according to regions, industries and investment scales, providing investors with a variety of options.

3.1 Corporate Income Tax (CIT) Benefits

The standard corporate income tax rate in Vietnam is 20%, but companies investing in industrial parks can enjoy a variety of preferential policies. The tax rates in different regions vary significantly. Special economic zones and high-tech parks can enjoy a preferential tax rate of 10% for a maximum of 15 years; the preferential tax rate in socio-economically difficult areas is 17% for a period of 10 years; and the preferential tax rate in socio-economically particularly difficult areas can be as low as 10% for a period of 15 years.

Industry-specific benefits are also a major feature of Vietnam’s CIT policy. High-tech enterprises and software development companies can enjoy a preferential tax rate of 10% for up to 15 years, and some key projects can even be extended to 30 years. Renewable energy projects enjoy a 20-year 10% preferential tax rate, which can be extended under special circumstances. Environmental protection projects are also favored by the policy and can enjoy a 10% preferential tax rate for 15 years.

The scale of investment is also an important factor in determining tax incentives. Large-scale manufacturing projects, especially those with investment capital exceeding VND6 trillion, can enjoy a 10% preferential tax rate for 15 years. For super-large projects or national key projects, the government is willing to provide a longer preferential period and lower tax rates, which usually require individual negotiations with the government.

It is worth noting that many projects can also enjoy a tax exemption period, usually tax exemption for the first four years and half tax reduction for the next nine years. This provides strong support for the initial development of enterprises.

3.2 Value Added Tax (VAT) Benefits

Vietnam’s standard VAT rate is 10%, but certain goods and services are eligible for preferential treatment. The range of goods and services exempt from VAT is quite wide, including unprocessed or pre-processed agricultural products, imported equipment and machinery for scientific research and technological development, certain educational equipment and teaching materials, some medical equipment and medicines, and technology transfer-related services.

The VAT refund policy is another aspect worthy of attention. Exporting enterprises can apply for VAT refunds, which greatly reduces their financial pressure. New investment projects can also apply for VAT refunds on the purchase of fixed assets during the construction phase, which provides support for the initial development of the project. Projects using advanced technology and energy-saving and environmentally friendly equipment can enjoy special VAT refund policies, reflecting Vietnam’s emphasis on high-quality development.

3.3 Import and export tax incentives

To promote the development of an export-oriented economy, Vietnam has also provided a number of preferential policies for import and export links. Imported raw materials used to produce export goods are exempt from import taxes, which greatly reduces the costs of export companies. Imported equipment, machinery, special transportation vehicles and building materials that form fixed assets are also exempt from import taxes, which provides strong support for the capital investment of enterprises. Imported equipment for projects in investment encouragement areas also enjoys import tax reductions and exemptions, reflecting the policy’s guiding nature. Imported goods used for scientific research and technological development are exempt from import taxes, which is conducive to enhancing the innovation capabilities of enterprises.

Export processing enterprises enjoy a series of special policies. Enterprises located in export processing zones are exempt from import taxes on imported raw materials and semi-finished products, and goods traded between export processing enterprises are exempt from value-added tax. These measures have greatly enhanced the competitiveness of enterprises. Such enterprises can also set up bonded warehouses to simplify customs clearance procedures and improve operational efficiency. Export enterprises in certain industries (such as textiles and electronics) can even enjoy export tax reductions and exemptions, further enhancing their international competitiveness.

These tax incentives provide investors with significant cost advantages, but their specific applicability still needs to be evaluated in detail based on the specific circumstances of the project and the latest policies. Investors should pay close attention to policy updates and consider seeking professional tax advice to make full use of these incentives and maximize the benefits of investing in Vietnam.

4. Land Use Preferential Treatment

The Vietnamese government is well aware of the importance of land policy in attracting investment, and has therefore introduced a series of preferential land use policies in industrial parks. These policies include not only rent reductions, but also measures to facilitate the acquisition of land use rights, aiming to create a more favorable investment environment for investors.

4.1 Land rent reduction policy

Vietnam’s land rent exemption policy varies by region and industry, reflecting the government’s strategic intention to guide investment direction and balance regional development. In special economic zones and high-tech parks, investors can enjoy a full land rent exemption period of up to 15 years. This policy greatly reduces the initial cost of enterprises and lays the foundation for their long-term development in Vietnam.

The land rent reduction period in socio-economically disadvantaged areas is usually 7-11 years, while in particularly disadvantaged socio-economic areas, this period can be extended to 15 years or even longer. This differentiated policy has effectively promoted industrial development in underdeveloped areas and promoted regional economic balance.

Specific industries can also receive additional land rent concessions. For example, high-tech enterprises not only enjoy a longer rent-free period, but also receive a 50% rent reduction in the subsequent period. Renewable energy projects can enjoy full land rent reduction in certain areas, reflecting Vietnam’s strong support for green industries. Large-scale manufacturing projects, especially those with investments exceeding US$100 million, can receive tailored land rent concession packages, which are often more generous and need to be negotiated separately with local governments.

It is worth noting that many industrial parks also provide “ready-to-lease” standard factories, with the same rental benefits as those directly applicable to land. This provides great convenience for small and medium-sized enterprises and investors who want to start operations quickly.

4.2 Convenient acquisition of land use rights

In recent years, the Vietnamese government has made great efforts to simplify the process of industrial land conversion to speed up the implementation of investment projects. In many industrial parks, the land has been converted and investors can directly rent or purchase it without going through complicated approval procedures. This greatly shortens the time from project planning to implementation.

For projects that require land use conversion, the government has set up a “one-stop” service window, with dedicated personnel to assist investors in completing all necessary procedures. In some key industrial parks, the approval time for land use conversion has been shortened from several months to a few weeks, greatly improving administrative efficiency.

Long-term land use rights guarantee is another highlight of Vietnam’s foreign investment attraction. Foreign-invested enterprises can obtain land use rights for up to 50 years, and for special projects, this period can even be extended to 70 years. This long-term guarantee provides investors with stable expectations and is conducive to long-term planning of enterprises.

In addition, Vietnamese law clearly stipulates that if the state reclaims the land for public purposes during the land use period, investors will receive reasonable compensation. This further enhances investors’ confidence. For land in industrial parks, the government has promised that when the use period expires, if the enterprise still needs to continue to use it and it complies with the plan, it will give priority to extending its use rights.

It is worth mentioning that Vietnam allows foreign-invested enterprises to apply for bank loans using land use rights as collateral, which greatly enhances the financing capacity of enterprises and provides strong support for their continued development in Vietnam.

In general, Vietnam’s preferential land use policies include both direct economic incentives and administrative convenience and long-term guarantees. These policies together build a land policy system that is very attractive to investors and become an important factor in Vietnam’s attraction of foreign investment. However, investors should still be aware that specific preferential policies may vary by region, industry and project scale. It is recommended to communicate in detail with relevant government departments and professional consulting agencies before making investment decisions to obtain the most suitable land use plan for their own projects.

5. Financing Support Policy

The Vietnamese government recognizes the importance of financing support in attracting investment and promoting enterprise development, and has therefore introduced a series of financing support policies. These policies cover multiple aspects such as preferential loans, foreign exchange management facilitation and investment guarantee mechanisms, aiming to provide all-round financial support for enterprises investing in Vietnam’s industrial parks.

5.1 Government preferential loan projects

The Vietnamese government has launched a variety of preferential loan programs for different types of enterprises and projects to support enterprise development and technological innovation.

The SME support program is one of the key points. The Vietnam Development Bank (VDB) has set up a special SME credit fund to provide low-interest loans to qualified SMEs. The loan interest rate is usually 2-3 percentage points lower than that of commercial banks, and the term can be up to 7 years. In addition, SMEs investing in priority development industries or regions can enjoy additional interest rate concessions. This program has greatly alleviated the financing pressure of SMEs and provided strong support for their development in industrial parks.

Special loans for high-tech enterprises are an important measure taken by the Vietnamese government to support innovation-driven development. The Science and Technology Development Fund provides high-tech enterprises with preferential loans, with interest rates as low as 50% of the market rate and loan terms as long as 12 years. These loans are mainly used to support the company’s R&D activities, technology upgrades and commercialization of innovative products. For projects in certain key technology fields, interest-free loan support can even be obtained. This policy has effectively stimulated the development of high-tech enterprises in industrial parks and promoted industrial upgrading.

5.2 Convenient foreign exchange management

In order to attract foreign investment and facilitate cross-border business, Vietnam has implemented a series of foreign exchange management facilitation measures in industrial parks.

The facilitation of cross-border capital flows is the core content. Foreign-invested enterprises can open foreign exchange accounts in banks in Vietnam to receive overseas remittances and pay international business. For export-oriented enterprises, the Central Bank of Vietnam allows them to retain 100% of foreign exchange income, which greatly facilitates the international operations of enterprises.

In addition, Vietnam has simplified the profit remittance procedure. As long as the enterprise has fulfilled its tax obligations, it can freely remit profits without additional approval. The investment capital of foreign investors can also be freely remitted after the investment project is completed. These measures have greatly enhanced the confidence of foreign investors and reduced the risks of cross-border investment.

It is worth mentioning that Vietnam is gradually relaxing its control over cross-border lending. For key projects invested in industrial parks, enterprises can more easily obtain overseas loans, which broadens financing channels for enterprises.

5.3 Investment guarantee mechanism

In order to further reduce investment risks, Vietnam has established a comprehensive investment guarantee mechanism.

The Government Investment Guarantee Fund is the core of this mechanism. The fund mainly provides guarantees for strategic industries, infrastructure projects and high-tech enterprises. Through government guarantees, these projects can more easily obtain bank loans with more favorable loan conditions. For foreign-invested enterprises, if the project is in line with Vietnam’s industrial policy orientation, they can also apply for government guarantees.

In addition to direct financial guarantees, the Vietnamese government also provides a series of non-financial guarantees. For example, for major investment projects, the government promises to provide necessary infrastructure support, guarantee land supply, etc. These non-financial guarantees are equally important, and they provide investors with more certainty and security.

In addition, Vietnam is actively cooperating with international financial institutions to introduce more guarantee mechanisms. For example, it is cooperating with the Multilateral Investment Guarantee Agency (MIGA) under the World Bank Group to provide political risk guarantees for foreign investment projects. This further enhances the confidence of foreign investors, especially in investment projects in some emerging industries and underdeveloped regions.

In general, Vietnam’s financing support policy system is comprehensive and flexible, providing multi-level financial support for investors in industrial parks. These policies not only reduce the financing costs of enterprises, but also increase the flexibility of fund use, while also reducing investment risks through guarantee mechanisms. However, investors should note that specific financing support policies may vary depending on the nature of the project, the scale of investment and the region. Investors are advised to fully understand the latest policies when formulating financing plans and seek professional financial and legal advice to maximize the use of these support policies.

6. Examples of preferential policies for specific parks and industries

Vietnam’s major industrial parks and key industries have their own unique preferential policies. The following is a detailed introduction to several typical cases. These cases show Vietnam’s differentiated strategies in attracting investment and promoting industrial development.

6.1 Hanoi High-Tech Park

As an innovation center in northern Vietnam, Hanoi Hi-Tech Park offers a series of attractive preferential policies. Enterprises in the park can enjoy a preferential corporate income tax rate of 10% for 15 years, with tax exemption for the first 4 years and 50% tax reduction for the next 9 years. For particularly important projects, the preferential period can be extended to 30 years.

In terms of land use, the park provides a land rent exemption period of up to 30 years. In addition, the park has set up a special high-tech development fund to provide low-interest loans and R&D subsidies to settled enterprises. It is worth mentioning that the park has established an industry-university-research cooperation platform with many top universities to provide talent and technical support for enterprises.

6.2 Ho Chi Minh City High-Tech Park

As a technological innovation base in southern Vietnam, Ho Chi Minh City High-Tech Park offers highly competitive preferential policies. High-tech enterprises in the park can enjoy a preferential corporate income tax rate of 10% for up to 15 years, and some key projects can even enjoy a longer preferential period.

The park places special emphasis on intellectual property protection and has set up a special intellectual property service center to provide enterprises with a full range of intellectual property protection and operation services. In terms of talent, the park has implemented a “talent apartment” plan to provide preferential housing policies for high-level talents. In addition, the park also cooperates with international partners such as Singapore to provide international entrepreneurship incubation services.

6.3 Da Nang High-tech Park

As an important innovation base in central Vietnam, Da Nang High-Tech Park provides a unique combination of preferential policies. Enterprises in the park can enjoy a preferential corporate income tax rate of 10% for 15 years, and some key projects can be extended to 30 years.

The park pays special attention to the environmental protection industry and provides an additional 5-year tax exemption for environmental protection technology companies. In terms of land use, the park provides a land rent exemption period of up to 11 years. In addition, the park has also established a special science and technology innovation fund to provide R&D funding support and venture capital matching services for settled companies.

6.4 Preferential policies for the electronics manufacturing industry

Electronics manufacturing is one of Vietnam’s key development industries and enjoys special preferential policies. Large-scale electronics manufacturing projects can enjoy a preferential corporate income tax rate of 10% for up to 30 years. For super-large projects with an investment of more than 12 trillion VND (about US$520 million), even lower tax rates can be obtained.

In terms of imports and exports, raw materials and parts used to produce electronic products are exempt from import taxes. Enterprises producing export products can also enjoy the VAT refund policy. In addition, the government also provides special talent training subsidies for the electronic manufacturing industry to support enterprises in training local technical workers.

6.5 Preferential policies for renewable energy industry

The Vietnamese government attaches great importance to the development of the renewable energy industry and has provided a full range of support policies. Renewable energy projects can enjoy a preferential corporate income tax rate of 10% for 15 years, which can be extended to 20 years for certain special projects. The first four years are tax-free, and the tax rate is reduced by half in the following nine years.

In terms of land use, renewable energy projects can be exempted from land rent for up to 14 years. For wind power and solar power projects, the government has implemented a fixed electricity price purchase policy to ensure investment returns. In addition, import duties are exempted for imports of renewable energy equipment, which greatly reduces the initial investment cost of the project.

The government has also set up a renewable energy development fund to provide low-interest loans and financing guarantees for related projects. It is worth mentioning that Vietnam is actively promoting the construction of “green industrial parks”, and renewable energy projects in these parks can receive additional policy support.

These preferential policy cases for specific parks and industries demonstrate Vietnam’s flexibility and pertinence in attracting investment and promoting industrial development. Investors can choose the most suitable parks and industrial fields according to the characteristics of their own projects to maximize the benefits of preferential policies. However, it should be noted that these policies may be adjusted over time and with changes in the economic situation. Investors are advised to maintain close communication with relevant park management departments and professional consulting agencies before making decisions to obtain the latest and most accurate policy information.

7. Special benefits for foreign-invested enterprises

In order to attract more foreign direct investment, the Vietnamese government has formulated a series of special preferential policies for foreign-invested enterprises. These policies not only involve enterprise access, but also include preferential measures in technology transfer, aiming to create a more favorable investment environment for foreign investors.

7.1 Access policy for 100% foreign-owned enterprises

In recent years, Vietnam has significantly relaxed restrictions on the entry of foreign-invested enterprises, providing foreign investors with more investment opportunities and greater operational autonomy. In most industrial parks and high-tech parks, foreign investors can set up 100% foreign-invested enterprises and enjoy the same treatment as local enterprises.

Specifically, 100% foreign-owned enterprises can enjoy preferential policies in the following areas:

First, in terms of market access, Vietnam has opened up most manufacturing sectors, allowing foreign-owned enterprises to operate wholly-owned enterprises. Even in some sensitive industries, such as telecommunications and finance, restrictions on foreign shareholding ratios have been gradually relaxed.

Secondly, in terms of land use rights, 100% foreign-invested enterprises can obtain long-term land use rights through leasing, with a maximum period of 50 years, and some special projects can even extend it to 70 years. This provides a stable guarantee for the long-term development of foreign-invested enterprises.

Furthermore, foreign-invested enterprises enjoy full autonomy in fund transfers. As long as they fulfill relevant tax obligations, they can freely remit profits back to their home countries without going through cumbersome approval procedures.

In addition, Vietnam has simplified the procedures for setting up foreign-invested enterprises. In many industrial parks, “one-stop” services have been implemented, greatly shortening the time for enterprise registration and obtaining various licenses.

7.2 Technology transfer related benefits

The Vietnamese government attaches great importance to promoting technology transfer by introducing foreign investment, and has formulated a series of preferential policies for this purpose:

First, foreign investment projects involving technology transfer can enjoy more favorable tax policies. For example, if the transferred technology falls within the scope of what Vietnam encourages to introduce, the relevant income can enjoy a preferential income tax rate of 10%, which is more favorable than ordinary foreign-invested enterprises.

Secondly, Vietnam has implemented a priority approval system for technology transfer contracts. For technology transfer in the high-tech field, the approval time can be shortened to 15 working days, which greatly speeds up the speed of technology introduction.

Furthermore, the Vietnamese government has set up a special technology transfer promotion fund to provide financial support for projects involving advanced technology transfer, including low-interest loans, R&D subsidies and other forms.

In addition, Vietnam has also stepped up its efforts in intellectual property protection. For foreign-invested enterprises involved in technology transfer, the government provides special intellectual property protection services, including fast patent review and priority handling of intellectual property disputes.

It is worth mentioning that Vietnam is actively promoting technical cooperation between local and foreign-funded enterprises. The government provides additional tax credits and subsidies to foreign-funded enterprises that conduct technical cooperation with local enterprises.

In general, Vietnam provides a full range of preferential policies for foreign-invested enterprises, especially those involved in technology transfer. These policies not only reduce the operating costs of foreign-invested enterprises, but also create a favorable environment for technology transfer. However, investors need to be aware that specific preferential policies may vary by industry, region and project size. It is recommended to fully communicate with relevant government departments and professional consulting agencies before making an investment decision to obtain the latest and most accurate policy information and formulate the best investment strategy.

At the same time, foreign investors should also note that with the continued development of Vietnam’s economy and industrial upgrading, these preferential policies may be adjusted. Therefore, establishing a long-term development strategy not only relies on preferential policies, but also focuses on improving its own competitiveness and localization, which is crucial to achieving long-term success in the Vietnamese market.

8. Application and Approval Process

In order to simplify the investment procedures and improve administrative efficiency, the Vietnamese government has significantly optimized the investment application and approval process for industrial parks. This goal is mainly achieved by setting up a one-stop service window and promoting an online application system. These measures have greatly simplified the application process for investors and shortened the time it takes to land a project.

8.1 Introduction to one-stop service window

Vietnam has set up one-stop service windows in major industrial parks to provide investors with comprehensive and efficient services. These windows are usually located in the park management committee and are composed of representatives from multiple government departments.

The main functions of the one-stop service window include:

Investment Advisory:Provide investors with comprehensive policy interpretation and investment guidance, including preferential policies, industry access regulations and other information.

Project Application:Assist investors in preparing and submitting investment application materials, including investment licenses, business registration certificates, etc.

License application:Centrally handle various certificates and licenses required by enterprises, such as business licenses, tax registration certificates, customs registration certificates, etc.

Employment services:Assist enterprises in handling labor permits, social insurance registration and other employment-related procedures.

Tracking service:Track the application progress throughout the process, communicate with investors in a timely manner, and solve problems encountered during the application process.

Subsequent support:After the project is approved, we will continue to provide various administrative services and policy consultation to the enterprise.

Through the one-stop service window, investors can complete most of the application and approval procedures in one place, greatly improving efficiency. For example, in Hanoi High-Tech Park, through the one-stop service window, the processing time for investment licenses for general projects has been shortened from 45 days to 15 days.

8.2 Online Application System User Guide

To further improve efficiency and convenience, Vietnam has launched an online application system for industrial park investment. This system allows investors to complete most of the application procedures online, greatly saving time and costs. The following are the basic steps to use the system:

Register an account:Visit the Vietnam Investment Management Portal (https://dautunuocngoai.gov.vn/) and click the “Register” button to create an account. You will need to provide basic company information and contact information.

Login system:Log in to the system using your registered account and password.

Select application type:According to the nature of the project, select the corresponding application type, such as new project investment, capital increase and expansion, etc.

Fill out the application form:Follow the system prompts to fill in detailed project information, including investment scale, industry category, site selection, etc.

Upload files:Scan and upload the required supporting documents to the system. Usually includes company articles of association, financial certificates, project feasibility study reports, etc.

Submit your application:After checking all the information is correct, click the Submit button. The system will automatically generate an application number.

Track progress:The system allows you to view the application processing progress in real time and receive relevant notifications.

Supplementary Materials:If additional materials are required, the system will issue a notification and investors can submit the additional documents online.

Get the result:Once the application is approved, investors can download the electronic version of the license in the system, and the paper version will be delivered by mail.

The advantages of using the online application system are: 24-hour service, not restricted by time and location; the application process is more transparent and progress can be tracked in real time; it reduces human factors and improves the fairness and efficiency of approval.

It should be noted that although the online system greatly simplifies the application process, for complex large-scale projects, offline supplementary materials or interviews may still be required. In addition, the languages ​​used in the system are mainly Vietnamese and English. If investors are not familiar with these two languages, it is recommended to seek assistance from professional intermediaries.

In general, Vietnam has greatly simplified the investment application and approval process for industrial parks through a one-stop service window and online application system. This not only improves administrative efficiency, but also creates a more convenient investment environment for investors. However, considering the complexity of the policy and possible language barriers, it is recommended that investors maintain close communication with relevant departments during the application process and seek professional advice when necessary to ensure a smooth application.

9. Policy Comparison and Recommendations

Vietnam’s preferential policies for industrial parks are quite competitive in Southeast Asia, but they are still unique compared to neighboring countries. This section will compare Vietnam’s preferential policies with those of neighboring countries and provide some suggestions for investors who intend to invest in Vietnam.

9.1 Comparison with the preferential policies of neighboring countries

Thailand:

Thailand’s Eastern Economic Corridor (EEC) offers attractive preferential policies. Compared with Vietnam, Thailand offers longer tax incentives in certain high-tech fields, up to 13 years of corporate income tax exemption. However, Vietnam has more advantages in labor costs and land rents.

Malaysia:

Malaysia’s Multimedia Super Corridor (MSC) provides comprehensive preferential policies in the IT and digital economy sectors. Compared with Vietnam, Malaysia’s policies focus more on the service industry and high-tech industries, while Vietnam’s preferential policies in manufacturing are more prominent.

Indonesia:

Indonesia has also been vigorously promoting the construction of industrial parks in recent years, and its tax incentives are similar to those of Vietnam. However, Vietnam may be better in terms of administrative efficiency and infrastructure.

Cambodia:

Cambodia offers longer-term tax incentives, with some industries enjoying a tax holiday of up to nine years. However, Vietnam has more advantages in terms of overall business environment, infrastructure and quality of human resources.

China:

Compared with China, Vietnam has a clear advantage in labor costs and greater tax incentives in certain industries. However, China still has advantages in market size, completeness of the industrial chain and high-end talent reserves.

In general, Vietnam’s preferential policies have strong comprehensive competitiveness in terms of tax exemptions, land use and financing support, etc. Especially in labor-intensive manufacturing and some emerging high-tech fields, Vietnam’s policies are more attractive.

9.2 Advice to investors

Comprehensive Assessment:Don’t just be attracted by preferential policies, but also consider factors such as market potential, labor supply, infrastructure, and political stability.

Long-term planning:Preferential policies may change over time. When formulating investment strategies, you should consider long-term development and not rely too much on short-term preferential policies.

Choose the right park:Different industrial parks have different preferential policies and industrial focuses, so it is crucial to choose the park that best matches the company’s development strategy.

Focus on localization:Actively promote localization strategies, including talent localization and supply chain localization, which can not only reduce costs but also obtain more policy support.

Follow policy updates:Vietnam’s policy environment changes rapidly, and investors need to pay close attention to policy updates and adjust investment strategies when necessary.

Seek professional help:Consider hiring a professional consulting firm that is familiar with Vietnam’s legal and investment environment to better understand and utilize the various preferential policies.

Focus on compliance:Strictly abide by Vietnam’s laws, regulations and policy requirements to avoid losing preferential qualifications due to violations.

Active communication:Maintain good communication with local governments and park management departments, provide timely feedback on issues and seek support.

Flexible response:Be prepared to respond to policy changes and maintain flexibility in business strategies.

Learn more:Before making an investment decision, it is recommended to visit several potential investment locations to gain an in-depth understanding of local conditions.

Focus on innovation:Vietnam is vigorously supporting innovation, and investors should consider increasing R&D investment to gain more policy support.

Focus on regional integration:Make full use of the various free trade agreements that Vietnam participates in to expand international markets.

In conclusion, Vietnam’s industrial parks offer many favorable policies to investors, but successful investment requires comprehensive consideration and strategy. Investors should make wise choices based on their own circumstances and fully understand the policies, and be prepared to deal with various challenges that may be encountered during the investment process. Through careful planning and flexible management, investors can expect to achieve long-term success in their investment in Vietnam.

10.Conclusion

With the continuous development of Vietnam’s economy and the changes in the global investment environment, the preferential policies of Vietnam’s industrial parks are also evolving. This conclusion will look forward to future policy trends and point out potential risks to help investors make more informed decisions.

10.1 Policy Trend Outlook

Industry upgrading orientation:Future preferential policies are likely to be more inclined towards high-tech industries, high value-added manufacturing and strategic emerging industries. Traditional labor-intensive industries may face the gradual withdrawal of preferential policies.

Balanced regional development:It is expected that the government will continue to guide investment to the less developed areas in the central and northern parts through differentiated policies to promote balanced regional economic development.

Green development incentives:Environmental protection and sustainable development will become important considerations in policy making. It is expected that more preferential measures will be introduced to encourage clean production, energy conservation and emission reduction, and circular economy.

Increased localization requirements:In the future, localization requirements for foreign-invested enterprises may be strengthened, including increasing the proportion of local procurement and increasing technology transfer, in order to promote local industrial development.

Innovation-driven policies:It is expected that support for R&D activities will be increased, including increasing R&D tax credits and establishing more innovation funds.

Talent policy optimization:In order to attract and retain high-end talents, more attractive talent introduction policies may be introduced, such as providing special tax incentives, simplifying work permit procedures, etc.

Digital transformation support:More special support policies may be introduced for areas related to digital economy and Industry 4.0.

Diversification of financing channels:It is expected that the financing support system will be further improved, and more market-oriented financing tools may be introduced, such as industrial funds and green bonds.

10.2 Potential risk warning

Policy uncertainty:Preferential policies may change with the economic situation and government strategy adjustments, and investors need to be wary of the risks brought about by sudden policy changes.

Intensified regional competition:As other Southeast Asian countries also actively attract foreign investment, Vietnam’s comparative advantage may be challenged.

Rising labor costs:With economic development, Vietnam’s labor cost advantage may gradually weaken, which may affect the actual effect of certain preferential policies.

Infrastructure bottlenecks:Although Vietnam has invested heavily in infrastructure construction, it may still face infrastructure deficiencies in some areas, affecting the implementation of preferential policies.

Complexity of the legal environment:Vietnam’s legal system is still a work in progress and there may be uncertainty regarding the interpretation and enforcement of regulations.

Administrative efficiency challenges:Despite the one-stop service, administrative efficiency issues may still be encountered in actual operation.

Cultural and Language Barriers:This may affect investors’ accurate understanding and effective use of the policy.

Geopolitical risks:Changes in the global trade environment and geopolitical situation may affect Vietnam’s preferential policies and overall investment environment.

Environmental compliance costs:As environmental protection requirements increase, companies may face higher environmental compliance costs.

Technology transfer pressure: In the future, the requirements for technology transfer by foreign-invested enterprises may be increased, which may increase the risk of intellectual property protection.

In summary, the preferential policies of Vietnam’s industrial parks provide investors with many opportunities, but they are also accompanied by various challenges and risks. Investors need to comprehensively evaluate these opportunities and risks and formulate long-term investment strategies. Investors are advised to pay close attention to policy trends, flexibly adjust investment strategies, strengthen risk management, deepen local operations, and maintain good communication with local governments and partners. Only in this way can sustainable success be achieved in investment in Vietnam’s industrial parks.

Finally, it is worth emphasizing that although preferential policies are important, the core competitiveness of enterprises is the key to long-term success. Investors should continuously improve their own technical level, management ability and market competitiveness while taking advantage of preferential policies to cope with various challenges and opportunities that may arise in the future.