Note: This article looks broadly at the business environment in Hai Duong. For specific details on setting up a company in Vietnam see: How to Start a Business in Vietnam.
Hai Duong province, located in the Red River Delta region of Vietnam, has emerged as a dynamic economic hub. With its strategic location, proximity to Hanoi, and a skilled workforce, the province has attracted significant domestic and foreign investment. Known for its rapid industrialization, Hai Duong has transformed from an agricultural-based economy into a manufacturing powerhouse.
The province offers a favourable business environment with a focus on supporting industrial development. Hai Duong has implemented various policies to attract investors, including infrastructure improvements, tax incentives, and streamlined administrative procedures. The government’s commitment to creating a conducive business climate has contributed to the province’s growing popularity among domestic and foreign enterprises.
As Vietnam continues its economic integration with the global market, Hai Duong has positioned itself as a competitive investment destination. The province’s strategic location, coupled with its skilled workforce and supportive government policies, make it an attractive option for businesses seeking to expand their operations in Southeast Asia.
Key economic sectors in Hai Duong
Hai Duong’s economy is characterised by a strong industrial focus, driving its rapid development.
Industry
Manufacturing is the dominant sector in Hai Duong, contributing significantly to the province’s GDP. The province has successfully attracted investments in various industries, including electronics, machinery, and supporting industries. Its strategic location and skilled workforce have made it a preferred destination for both domestic and foreign investors.
Agriculture
Despite its industrialization, agriculture remains an important component of Hai Duong’s economy. The province is known for its agricultural products, such as rice, fruits, and vegetables, contributing to food security and rural development.
Services
The service sector is growing in tandem with the province’s industrialization. Supporting industries such as logistics, transportation, and retail are expanding to meet the increasing demands of the local economy and businesses.
These key sectors have contributed to Hai Duong’s economic growth and its position as a significant industrial hub in Vietnam.
Public Administration Performance Index
The Public Administration Performance Index (PAPI) measures the efficiency and quality of public administration services provided by a government. In the context of Hai Duong, the PAPI provides insights into the city’s governance effectiveness.
PAPI, Hai Duong, 2019 to 2023
| 2023 | 2022 | 2021 | 2020 | 2019 | |
| Participation | 4.94 | 5.33 | 4.83 | 5.16 | 5.55 |
| Transparency of Local Decision-making | 5.04 | 5.15 | 5.45 | 5.43 | 5.86 |
| Vertical Accountability | 3.90 | 4.29 | 4.13 | 4.86 | 4.98 |
| Control of Corruption in the Public Sector | 7.00 | 6.37 | 6.93 | 7.07 | 6.88 |
| Public Administrative Procedures | 6.78 | 7.26 | 7.34 | 7.17 | 7.37 |
| Public Service Delivery | 7.48 | 7.80 | 7.80 | 6.94 | 7.39 |
| Environmental Governance | 3.21 | 2.82 | 3.14 | 3.69 | 3.63 |
| E-Governance | 3.40 | 3.12 | 3.06 | 2.49 | 4.07 |
| Unweighted PAPI Score | 41.75 | 42.14 | 42.69 | 42.80 | 45.74 |
Source: The Vietnam Provincial Governance and Public Administration Performance Index
Provincial Competitiveness Index
The Provincial Competitiveness Index (PCI) is a key tool for evaluating the business environment in Vietnam’s provinces. Hai Duong, as Vietnam’s economic hub, is always a focal point in PCI reports.
PCI, Hai Duong, 2019 to 2023
| 2023 | 2022 | 2021 | 2020 | 2019 | |
| Entry Costs | 7.94 | 7.55 | 7.24 | 7.58 | 7.45 |
| Access to land | 7.26 | 7.35 | 7.37 | 6.52 | 7.42 |
| Transparency | 5.02 | 5.31 | 5.43 | 5.37 | 6.33 |
| Time Costs | 7.62 | 7.08 | 7.23 | 6.97 | 6.13 |
| Informal Charges | 7.25 | 6.81 | 7.24 | 5.28 | 4.88 |
| Policy Bias | 6.62 | 5.41 | 8.38 | 5.13 | 6.35 |
| Proactivity | 7.04 | 6.67 | 8.24 | 5.09 | 6.03 |
| Business Support Policy | 5.72 | 5.95 | 6.56 | 6.5 | 6.16 |
| Labor Policy | 6.73 | 5.61 | 6.64 | 7.46 | 7.21 |
| Law & Order | 7.76 | 7.73 | 7.83 | 5.9 | 5.71 |
| PCI Scores | 68.68 | 65.22 | 67.65 | 62.52 | 63.85 |
| Ranking | 17 | 32 | 13 | 47 | 47 |
Source: Provincial Competitiveness Index 2023
Foreign direct investment in Hai Duong
Hai Duong has emerged as a promising destination for foreign direct investment in Vietnam. The province’s strategic location, coupled with a favourable investment climate, a skilled workforce, and robust infrastructure, has attracted significant foreign capital. Its proximity to Hanoi, the nation’s capital, and major transportation networks provides easy access to both domestic and international markets.
In the first seven months of 2024, Hai Duong added 39 new foreign invested projects to its tally and newly registered capital of US$197.3 million. Though significant, this represented a fall of about 15.7 percent compared to the first seven months of last year during which it recorded US$232.9 million in newly registered capital.
Entertainment and recreation in Hai Duong
While Hai Duong is primarily known for its industrial development, the province offers a growing range of entertainment and recreational options for both residents and visitors.
Entertainment
- Cultural events: Hai Duong hosts various cultural events and festivals throughout the year, showcasing the province’s rich heritage. These events often feature traditional music, dance, and local cuisine.
- Karaoke: A popular form of entertainment in Vietnam, karaoke is widely available in Hai Duong, offering a fun and social experience.
Recreation
- Natural attractions: Hai Duong boasts some natural attractions, including parks and rivers, providing opportunities for outdoor activities such as picnics and walks.
- Sports and fitness: There is a growing interest in sports and fitness in Hai Duong, with the emergence of gyms and sports centres.
While Hai Duong’s entertainment and recreation scene may not be as developed as larger cities, it is steadily improving to cater to the growing needs of its residents and visitors.
What’s next?
Hai Duong is one of the most prominent manufacturing hubs in Vietnam and has emerged as a dynamic and attractive location for businesses seeking to invest in the country. Its strategic location, coupled with a favourable investment climate, a skilled workforce, and a focus on industrial development, has positioned the province as a key player in the country’s economic growth. While challenges such as infrastructure development and competition from other provinces exist, Hai Duong’s strong growth potential and supportive government policies offer significant opportunities for businesses.
As Vietnam continues its economic ascent, Hai Duong is well-positioned to capitalise on the expanding market. By leveraging its strengths in manufacturing, agriculture, and services, the province is poised to become an even more important investment destination in the years to come.
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