With this result, Vinh Phuc became one of the localities with the highest percentage of FDI enterprises wishing to expand in the country. According to the survey results of PCI 2021, up to 55.9% of FDI enterprises surveyed will definitely increase their business scale in 2021 locally.
In November 1996, at the 10th session, the IX National Assembly issued a resolution to separate Vinh Phuc province into two provinces of Vinh Phuc and Phu Tho. Accordingly, on January 1, 1997, Vinh Phuc province was officially re-established and put into operation.
At that time, Vinh Phuc was still a poor province, ranked 57/61 in economic development. However, after 25 re-establishment of the province, in 2021, the economic scale will reach 136.2 trillion VND, an increase of nearly 70 times compared to 1997.
In April 2022, shared with the press at the launching ceremony of the Provincial Competitiveness Index (PCI) 2021 organized by the Vietnam Chamber of Commerce and Industry (VCCI) and the US Agency for International Development USAID in Organized by Vietnam, Chairman of Vinh Phuc Provincial People’s Committee, Mr. Le Duy Thanh, said that, after 25 years of re-establishing the province, from the first day until later, Vinh Phuc has always determined that attracting investment is a one of the important tasks to improve and promote local economic growth and development.
Chairman of Vinh Phuc Provincial People’s Committee said that the province always identifies each type of business as having extremely important positions in the local socio-economic development strategy. Enterprises are not only the creators of added value, but also the factors that create the sustainable development of a locality in particular as well as of the country in general, he analyzed.
“Foreign-invested enterprises often have a certain position because while we are short of capital, experience and lack of management capacity, they are the ‘stones’ to create a boost,” the chairman said. Vinh Phuc Provincial People’s Committee, Mr. Le Duy Thanh shared.
“Besides, domestic enterprises, small and medium-sized enterprises are our businesses. They were founded by our own people and they are the real businesses that create the sustainability of the country. local,” added Mr. Thanh.
Accordingly, in order to attract and retain foreign and domestic investment enterprises, improving the local business and investment environment is a very important factor.
PCI data over the years shows that, in the period 2005 – 2009, Vinh Phuc always remained in the top 10 provinces with the highest provincial competitiveness index in the country. In which, 2008 was the highest ranked locality year, in third place with 69.37 points.
However, since 2010, Vinh Phuc’s PCI scores and rankings have tended to decrease quite a bit. In particular, in 2012, Vinh Phuc’s PCI ranking dropped 26 places, ranked 43/63 with 55.15 points. These are the five localities with both the lowest PCI ratings and scores in the past 16 years. The index of legal institutions and dynamism of the province reached 3.17 and 2.93 points, respectively, the two indexes that dropped the most points among the component indexes.
In 2015, Vinh Phuc returned to the top 4 in PCI rankings but could not maintain this rank in the following years. From 2016 to 2020, the province’s PCI ranking continued to decline. In 2020, the province’s competitiveness index decreased to 63.84 and ranked only 29/63 provinces and cities across the country.
According to the Provincial Competitiveness Index Report 2021 released in April 2022, Vinh Phuc’s PCI score has increased to 69.69 points. In just 1 year, this locality has jumped up 24 steps and entered the top 5 provinces and cities with the highest PCI scores in the country.
Out of 10 sub-indices, only 3 sub-indexes fell and 7 gained points. In which, the informal cost index increased the most with 8.05 points, up 1.8 points compared to 2020 and ranked 3rd in the country.
“Some people think this is a spectacular comeback. Because Vinh Phuc has achieved this rank many years ago, but in the past 10 years, it has fallen behind. However, we think that coming back is good, but it is not by chance that it has to be traded off with a process of persistent, determined and drastic striving”, Mr. Thanh said.
Accordingly, from 2020, the provincial government has set the “3 good” goals including: a good and comprehensive legal environment, good technical infrastructure, and good business service. In particular, administrative procedure reform is considered a key task, which is drastically implemented in the direction of reducing time and simplifying procedures.
For example, the province committed to cut the time for checking before VAT refund at the taxpayer’s headquarters to 40 working days and cut administrative procedures to fulfill the tax payment obligation to the state budget. less than 115 hours/year. The province has also built and put into use a modern and interconnected one-stop shop at all 3 levels.
In particular, the province’s hotline system is effectively established and operated with 5 languages: Vietnamese, Chinese, English, Japanese, and Korean. Vinh Phuc is also one of the first provinces to establish and effectively promote the role of the assisting group of the Chairman of the Provincial People’s Committee to remove difficulties for businesses.
In 2021, the Working Group has synthesized 97 groups of opinions from businesses in the province and directly guided administrative procedures for investors, as well as recommended competent authorities to handle the issues. problems reported by businesses.
Right from the time of re-establishing the province, the Provincial Party Committee, People’s Council and People’s Committee of Vinh Phuc province have identified promotion and investment attraction as the “key” for Vinh Phuc’s development. Since then, Party committees and authorities at all levels have taken breakthrough directions to become the “bright spot” of the country in terms of investment attraction.
In 1998, in the province, there were only 8 projects with foreign investment capital (FDI) and 1 domestic investment project, there was no industrial park. However, cumulatively until the first 6 months of 2022, Vinh Phuc has 438 FDI projects with a total investment capital of 7.3 billion USD. In the first 7 months of 2022 alone, the province has granted new investment certificates/investment policies for 15 FDI projects and increased capital for 23 times of FDI projects, with a total newly granted and increased investment capital of nearly 363 million USD. In particular, the main investment fields are processing and manufacturing industries such as electronics, automobiles, motorbikes, etc.
In terms of investment partners, one of the countries with the largest number of projects and investment capital in Vinh Phuc is Japan with 58 projects and 1.62 billion USD of registered capital. This is a country that contributes to laying the foundation for the locality to become a production center in the fields of automobiles, motorcycles, mechanics, manufacturing… of the whole country with the investment of some of the world’s leading corporations. such as Toyota, Honda, Sumitomo.
Specifically, Sumitomo Group with the investment project of Thang Long Industrial Park has a total registered capital of more than 2,000 billion VND, with a scale of 213 hectares; SOJITZ Group with a high-tech agricultural investment project on raising and processing beef cattle for export has a total investment of 500 million USD.
Since 1995 when Toyota invested in Vinh Phuc until now, this Japanese investor has always kept the leading position in the Vietnamese automobile market with a factory output of over 70,000 vehicles per year. Thanks to the operation of the stamping workshop in 2013 and the Auto Parts Export Center in 2007, as well as promoting activities to improve localization at the factory, Toyota has increased the vehicle localization rate from 19% to 37 %.
At the conference “Vinh Phuc in connection, cooperation and development between Vietnam and Japan” by Vinh Phuc province in collaboration with the Ministry of Foreign Affairs, the Embassy of Japan in Vietnam and the Japan Trade Promotion Organization (JETRO) held in June 2022, the representative of Toyota Corporation, Mr. Keisuke Tokunaga, shared that, in more than 25 years of investing and operating in Vinh Phuc, the business has always received the attention and support from the government. localities in surveying the investment environment, site clearance, project implementation, etc.
Mr. Mihara Daiki, General Director of Honda Vietnam shared at the conference: “Since investing in Vinh Phuc since 1996, we have always received support from the provincial government in solving real problems. This is the reason why businesses always try to operate and expand production to contribute to local economic growth.”
Talking about the reason for choosing Vinh Phuc to invest, a representative of Sumitomo Group said that the locality is a place with rich natural conditions and many trees, making Japanese investors always feel comfortable when coming here. bear and reminisce about the Japanese homeland.
In addition, Vinh Phuc’s geographical location has many advantages, with a developed transportation system, helping investors to easily access major traffic routes of Vietnam. Finally, complete infrastructure and the support of provincial leaders are also important factors that make businesses decide to choose Vinh Phuc for investment.
Also within the framework of the conference, Mr. Nguyen Van Do, Director of the Department of Planning and Investment of Vinh Phuc province, said that Vinh Phuc is also considered as one of the few localities across the country that has built a supply chain of agricultural products. finished products in the fields of automobiles and motorcycles and attracted diversified foreign investment flows. Accordingly, these are very important opportunities for the locality to attract foreign investment flows.
In general, since the re-establishment of the province until now, Vinh Phuc’s economy has made remarkable progress in both quantity and quality. In the period 1997-2021, the average growth rate of GRDP increased by 13.44%/year. If the economic scale in 1997 was only 1.96 trillion VND, by 2021, this number will increase by 69.6 times, reaching 136.2 trillion VND.
Not only is the country’s bright spot in terms of economic development, but Vinh Phuc is also a bright spot in the implementation of poverty reduction policies. After 25 years of development, the poverty rate of the situation has decreased from 20% to less than 2%.
Specifically, according to the Department of Labor, War Invalids and Social Affairs, by the end of 2021, the province has 5,207 poor households, accounting for 1.51% of the total number of households in the province. In which, poor households in urban areas account for 0.98%, poor households in rural areas account for 1.72%.
In addition, Vinh Phuc’s per capita income has improved markedly. In 2002, the province’s average income ranked 41st out of 63 provinces and cities, reaching more than 200,000 VND/person/month. By 2021, the province’s average income has increased to 4.5 million VND/person/month, reaching the top 10 localities with the highest average income in the country. Thus, after 19 years, the province’s average income has increased 17 times.
In the five-year socio-economic development plan 2021-2025 of the People’s Committee of Vinh Phuc province, the locality sets a target of an average economic growth rate of 8.5-9.0%/year. In which, industry – construction accounted for 61.5- 62.0%; services account for 32 – 32.5%; agriculture, forestry and fishery account for 6 – 6.5%. GRDP per capita is about 130 – 135 million VND (current price).
Regarding investment attraction, the locality aims to attract more investment capital from 2.0-2.5 billion USD in FDI capital and 20-25 trillion VND in DDI capital. In addition, Vinh Phuc will focus on industrial development as a premise to create a driving force for other economic sectors to develop. Attract investment to fill existing industrial zones and clusters, supplement planning, develop new industrial zones and clusters in advantageous places such as: Dong Soc Industrial Park, Son Loi Industrial Park, etc. Yen Lac, Xuan Loi industrial clusters… Develop specific policies to attract investment in projects with large investment scale, production of products with added value and high technology content, on a large scale. low land use.
In addition to the target on macro growth factors, the socio-economic development plan also emphasizes on improving the business investment environment. Specifically, the province will focus on reviewing and eliminating procedures and regulations that are causing difficulties and hindering investors.
According to the leader of Vinh Phuc province, creating a truly open investment environment is extremely important. In the coming time, the locality will pay special attention to the transparency and dynamism of the provincial government.
“Because we are a province at the provincial level, although we do not have the right to change institutions, we can completely implement institutional transparency to guide, facilitate and support businesses to approach them, accompanying them in implementing the institution,” shared Mr. Le Duy Thanh, Chairman of Vinh Phuc Provincial People’s Committee.