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LG factory complex in Hai Phong set to be completed in 2025

South Korea’s LG is set to complete its factory complex in Vietnam’s northern port city of Hai Phong, in 2025, the CEO of the firm has told the Vietnamese Prime Minister, according to The Investor

LG Electronics established its first plant in Hai Phong, in 2015, to produce smartphones and tablets. In April of 2021, however, the plant began to transition from smartphone production to focus on household appliances driven by significant losses in the smartphone market and rising demand for home appliances globally

LG Display was later established in Hai Phong in 2017, producing OLED modules for TVs, phones, and watches. In 2021, the firm increased its investment by US$1.4 billion to boost the production of plastic OLED displays from around 13 to 14 million units per month.

LG Innotek also began operations in 2017, focusing on camera module production. The facility started with an initial $US1 billion investment but in June of last year, it announced it would double its investment to $2 billion.

Of note, in 2013, Trang Due Industrial Park, where the complex is located, gained official approval from the Prime Minister to become part of the Dinh Vu-Cat Hai Economic Zone giving the park access to government incentives only offered to approved Economic Zones. For example, firms in the past have been eligible to pay no taxes for the first four years, and a ten percent tax rate for the following 15 years.

That said, in response to the OECD’s Global Minimum Tax initiative, Vietnam’s National Assembly passed Resolution 107 late last year, which will see multinational companies paying less than 15 percent tax, required to make up the difference via a top up the tax mechanism.

See also: How to Open a Factory in Vietnam: Ultimate Guide 2024

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