Overview of provinces and municipalities in Vietnam

Overview of Binh Duong Province

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As more and more people pay attention to the Vietnamese market, Yuanzhe
Consulting has also received a large number of inquiries related to the
Vietnamese market. These questions involve many fields, such as:

-Are there big differences in salary levels in different regions in Vietnam?

-How do foreigners set up a company in Vietnam?

-What kind of preferential policies do foreign-invested enterprises enjoy in

Vietnam?

-How do foreign-funded enterprises rent offices in Vietnam and hire

Vietnamese employees?

-Is it better for textile and clothing manufacturers to set up factories in

southern Vietnam or northern Vietnam?

-How to sell the auto parts you produce to Vietnam?

-How to purchase natural rubber from Vietnam?

-How will Vietnam’s cement market demand grow in the next few years?

-What is the price of industrial electricity in Vietnam?

-Has the impact of COVID-19 on Vietnam been eliminated?

- Various other issues.

Yuanzhe Consulting will answer the questions of high concern related to

Vietnam one by one. We will launch a series of topics related to Vietnam’s
macroeconomics, investment policies, industry research, and regional
economic research to help everyone better understand the Vietnamese
market.

We will introduce you to basic information about various regions in Vietnam to

help you better understand the Vietnamese market and discover your own
investment opportunities.

Administratively, Vietnam is divided into 58 provinces and five municipalities

directly under the central government (Can Tho, Da Nang, Haiphong, Hanoi,
and Ho Chi Minh City). Provinces and cities vary in size. The largest province
in Vietnam is Nghe An Province, with an area of about 6,368 square
kilometers. The smallest province is Bac Ninh Province, with only 822.71
square kilometers; the most populous province is Ho Chi Minh City. Data

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shows that in 2021 Ho Chi Minh City has a population of 9.166 million, and
the province with the smallest population is Bei Kan Province, with only
323,700 people.

According to Yuanzhe Consulting's analysis, regions such as Ho Chi Minh

City and Hanoi City in Vietnam have relatively developed economies, large
populations, and high per capita monthly wages. The overall economic level
of these cities is relatively developed and suitable for the development of
industries with higher added value, such as finance and service industries.

1. Binh Duong Province Overview

1.1. Binh Duong Province’s location in Vietnam

Binh Duong Province (Bình Dương in Vietnamese) is a province in

southeastern Vietnam. The provincial capital is Thu Dau Mot City. Binh Duong
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Province borders Binh Phuoc Province to the north, Ho Chi Minh City to the
south, Dong Nai Province to the east, and Tay Ninh Province to the west, with
an area of approximately 2,694.64 square kilometers.

Located next to Ho Chi Minh City, Binh Duong is strategically linked to the
Southern key economic quadrangle of Vietnam. With well-built infrastructure,
efficient administration and strong support from its government on tax
incentives, Binh Duong attracts many Foreign Direct Investment projects and
is one of the most reputable destinations for MNCs.

Situated in Ben Cat, Binh Duong Province, the 500-hectare PITP is located:

 02 km to nearest Rach Bap river port;

 05 km to Ring Road No.4, the connection road to all provinces of the
South;
 07 km to An Tay River Port - Future Development 2025 - 2030;
 16 km to My Phuoc-Tan Van highway, the key road to Long Thanh -
Dong Nai province;
 18 km to Thu Dau Mot City;
 41 km to HCM city and Tan Son Nhat Airport;
 57 km to Tan Cang-Cat Lai Port.

Population

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According to the 2022 census data, the total population of Binh Duong
Province is approximately 2.6275 million, with a population density of
approximately 964 people/square kilometer.

1.2. Economy overview

In 2022, Thu Dau Mot City, Thuan An City, Di An City, Ben Cat City, Tan Uyen
City, Bau Bang District, Bac Tan Uyen District, Dau Tieng District, and Phu
Giao District under Binh Duong Province are classified into the Region I in
Vietnam. In the region, the monthly minimum wage for workers is VND 4.68
million (approximately US$200). According to data released by the Vietnam
Statistics Bureau, in 2022, Binh Duong Province’s GDP growth rate was
8,29%, and per capita GDP reached US$6,824.

According to Yuan Zhe Consulting’s analysis, Binh Duong Province is actively

promoting investment in various industrial parks. In 2022, Binh Duong
Province plans to build 34 industrial parks with a total planned area of 14,790
hectares. Up to now, 29 industrial parks have been built in the province, with a
total planned area of 12,662 hectares. Among them, 27 industrial parks have
been put into operation, with a total area of nearly 10,962 hectares, focusing
on attracting foreign investment in industrial parks that have been planned
and developed.

1.3. Labor Market

Opportunities
 Young and dynamic workforce: Binh Duong's population under 35
years old is about 50%, higher than the national average. This creates
a young, energetic human resource capable of adapting to new
technologies.
 Highly skilled workforce: The province has more than 2,000 vocational
and technical training facilities, providing training to more than 100,000
students each year. This contributes to improving the skill level of the
labor force in the province.
 Strategic location: Binh Duong is located near Ho Chi Minh City, a
major economic center of Vietnam. This facilitates access to markets
and resources, and attracts foreign investment.
Challenges
 Skills gap: Despite advances in skills development, there is still a need
for skilled workers in areas such as high tech and specialist trades.
Businesses in these sectors may have difficulty finding suitable talent.

 Highly competitive: Binh Duong is an attractive location for both

businesses and job seekers, leading to a competitive recruitment
scene in a number of industries.
2. Binh Duong Province Economy
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 2.1. Key economic sectors of Binh Duong province
Manufacturing: This powerhouse drives Bình Duong's economic growth,
accounting for nearly 60% of its GRDP. The sector is well-developed,
attracting major investments in areas like:
 Electronics: Home to Samsung's largest Southeast Asian factory,
producing smartphones, TV components, and more. Numerous other
multinational electronics companies like Intel and NXP Semiconductors
have also set up base here.
 Textiles and Garments: Major brands like Nike and Adidas source
apparel from Bình Duong's extensive garment factories, making it a
leading apparel manufacturing hub.
 Furniture: Renowned companies like IKEA and Ashley Furniture have
chosen Bình Duong for their furniture production, leveraging its skilled
workforce and efficient logistics.
 Machinery and Industrial Equipment: Caterpillar, John Deere, and other
heavy machinery manufacturers operate facilities in Bình Duong,
catering to Vietnam's growing infrastructure and construction needs.
Services: As the manufacturing sector flourishes, so does the service
industry, employing around 25% of the workforce. Key areas include:
 Logistics and Warehousing: Bình Duong's strategic location and
extensive industrial zones attract significant investment in warehouses,
logistics services, and distribution networks.
 Finance and Banking: Major banks like HSBC and Standard Chartered
have established branches in Bình Duong, catering to the financial
needs of businesses and individuals.
 Tourism and Hospitality: With historical sites, natural attractions, and
proximity to Ho Chi Minh City, Bình Duong offers exciting tourism
opportunities, leading to a blossoming hospitality sector.
Agriculture: Despite its industrial focus, Bình Duong remains a significant
agricultural producer, contributing around 5% of its GRDP. Key products
include:
 Tropical Fruits: Longan, durian, and other tropical fruits are major
exports, earning Bình Duong the nickname "fruit kingdom."
 Rubber: With fertile land and abundant resources, Bình Duong ranks
among Vietnam's top rubber producers, supporting the national rubber
industry.
 Fishery: Abundant water resources and proximity to the sea support a
thriving aquaculture industry, producing shrimp, catfish, and other
seafood.
Emerging Sectors: Bình Duong constantly strives for diversification, with new
sectors gaining traction:
 Renewable Energy: Solar and wind power projects are gaining
momentum, with Bình Duong attracting significant investment in
renewable energy initiatives.
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  Information Technology: A young and tech-savvy population fosters a
rapidly growing IT sector, with software development companies and
startups setting up shop.
 Creative Industries: Film, media, and design are witnessing increasing
momentum, supported by a vibrant local scene and government
initiatives.

Binh Duong's economic strength lies in its strategic blend of established

sectors like manufacturing and agriculture, alongside rapidly growing service
industries and exciting emerging fields. This balanced approach positions the
province for continued success and solidifies its position as a key economic
powerhouse in Vietnam.

2.1.1. Outstanding FDI enterprises and local Vietnamese companies

Bình Duong boasts a plethora of outstanding FDI enterprises and local

Vietnamese companies playing crucial roles in its booming economy.

Company Names Major Business

FDI Enterprises Samsung Vietnam Produces smartphones,
TV components, and
more, setting the
technological
benchmark.
Intel Products Vietnam Intel manufactures and
exports integrated
circuits, chips, and
other electronic
components.
LEGO Manufacturing Vietnam Focusing on molding
and packing LEGO
bricks.
Nestlé Vietnam Food processing
industry and exporting
popular brands like Milo
and Nescafé.
NXP Semiconductors Vietnam Manufactures
semiconductors and
integrated circuits for
various applications.
Local Thang Long Cement Operates a large plant
Vietnamese in Bình Duong, catering
Companies to Vietnam's substantial
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Hoa Sen Group
Khang Điền Corporation
Viettel Group
Long Thanh Corporation
2.1.2. Outstanding Industrial Park in Binh Duong
VSIP Industrial Park
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construction needs and
contributing to
infrastructure
development.
Operates a major mill in
Bình Duong, supplying
steel for construction
and other industries,
promoting domestic
production and
reducing dependence
on imports.
Building high-quality
residential and
commercial projects,
contributing to urban
development and
catering to the growing
housing demand.
Providing vital ICT
infrastructure and
services, connecting
businesses and
individuals and
enabling technological
advancement.
Manages the
development of Long
Thanh International
Airport, a major
infrastructure project
boosting Vietnam's
connectivity and
passenger capacity,
positioning Bình Duong
as a key transportation
hub.
Established: 1996 (Phase 1), with two expansions in 2005 and 2007.

Location: Strategically located in Thuan An District, Binh Duong, with

proximity to Ho Chi Minh City and major transportation hubs.

Size: Over 5,000 hectares across two phases, with Phase 1 focusing on
industrial land and Phase 2 offering a mix of industrial, commercial, and
residential areas.

Infrastructure: Provides world-class infrastructure, including power grids,

water supply, wastewater treatment, transportation networks, and
telecommunications facilities.

One-stop service: Offers administrative and business support services,

simplifying company registration, licensing, and operational procedures.

Tenant Mix: Houses a diverse range of companies across various industries,

including electronics, textiles, garments, food processing, machinery, and
automotive parts.

Notable Tenants: Samsung, Intel, LEGO, Nestle, NXP Semiconductors, and

leading Vietnamese companies like Hoa Sen Group and Thang Long Cement.
Dai Dang Industrial Park

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Established: 2005

Total area: 274.35 hectares

Land for industrial factories: 166.03 hectares (occupied: 76.08 hectares)

Location: Phu Tan Ward, Thu Dau Mot Town, Binh Duong

Investment capital: 416 billion VND ($17.4 million)

Type of park: Mixed-purpose (includes areas for manufacturing, storage,

offices, parks, trading centers)
Song Than Industrial Park

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Total area: 533.84 hectares

Land for industrial plants: 319.79 hectares

Companies housed: over 300 (including multinationals like Samsung, Nestlé,

and NXP Semiconductors)

Industries represented: diverse, including electronics, food & beverage,

textiles & garments, automotive, and furniture
Nam Tan Uyen Industrial Park

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Established in 2005, Nam Tan Uyen Industrial Park (NTU) has carved a
significant niche in Binh Duong's industrial landscape. Here's a quick overview
of its general information:

Location: Strategically located in Tan Uyen district, Binh Duong, providing

proximity to major highways, the Dong Nai River, and Ho Chi Minh City.

Size: Comprises over 330 hectares of land, with dedicated zones for both
industrial and service operations.

Industries: Home to a diverse range of companies representing sectors like:

 Electronics and Electrical Appliances: Major players like Samsung and

Panasonic have manufacturing bases here.
 Textiles and Garments: Companies like YKK zippers and Texhong
Textile leverage NTU's infrastructure and access to ports.
 Food and Beverage Processing: Renowned names like Nestlé and
Ajinomoto cater to regional demand from their NTU facilities.
 Automotive and Machinery: Manufacturers like Denso and Sumitomo
Electric contribute to Vietnam's burgeoning industries with their NTU
plants.

My Phuoc Industrial Park

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Established in 2002, MPIP has expanded over the years, currently
encompassing four phases:

o My Phuoc 1: 400 hectares

o My Phuoc 2: 800 hectares
o My Phuoc 3: 2,280 hectares
o My Phuoc 4 (Thoi Hoa IP): 1,000 hectares

Each phase focuses on specific sectors, attracting diverse companies and

fostering a vibrant industrial ecosystem.

Industries and Companies

MPIP houses a diverse range of industries, with a strong focus on:

o Electronics and Electrical Appliances: Samsung, NXP

Semiconductors, Intel
o Textiles and Garments: Texhong Textile, Natsteel Apparel
o Food and Beverage: Nestlé, Coca-Cola
o Automotive and Machinery: Numerous component and parts
manufacturers

Over 800 companies currently operate within MPIP, contributing significantly

to Binh Duong's export earnings and job creation.
Bau Bang Industrial Park

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Nestled in Binh Duong, Bau Bang Industrial Park (BBIP) is booming. With
2,000 hectares across two phases, it attracts diverse businesses like
Samsung and Nestle.

Focus: Electronics, textiles, food processing, machinery.

Key Features:

Strategic location on National Highway 13.

Developed infrastructure with roads, utilities, and amenities.

Competitive land lease rates and investment incentives.

Tan Dong Hiep B Industrial Park

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Nestled in Binh Duong, Bau Bang Industrial Park (BBIP) is rapidly making its
mark. With over 2,000 hectares, it caters to diverse industries like electronics,
textiles, food, and machinery. Modern infrastructure, supportive services, and
competitive incentives attract companies like Samsung, LG, and Nestle.
Expanding Phase 2 offers even more potential. While facing some growing
pains, BBIP's commitment to sustainability and future development positions it
as a leading Binh Duong hub.
Tan My 2 Industrial Park

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Location: Tan Dong Hiep Ward, Bac Tan Uyen District, Binh Duong Province.

Size: Approximately 88.8771 hectares.

Established: Detailed plan approved in March 2007.

Investment: Total investment capital of 300 billion VND, with 105.705 billion
VND already disbursed.

Industries: Mainly focuses on light industrial sectors like food processing,

furniture manufacturing, and supporting industries for existing larger industrial
zones.

Infrastructure: Basic infrastructure is mostly built, including roads, drainage

systems, water supply, and wastewater treatment facilities. However,
development is still ongoing, and some aspects might require further
expansion.

Thuan An Industrial Park

Established in 1991, Thuan An Industrial Park (TAIP) boasts a long and

impactful history as one of Binh Duong's first and most prominent industrial
hubs. With over 350 diverse companies operating within its boundaries, TAIP
contributes significantly to the province's economic dynamism.

2.2. Foreign direct investment

2.2.1. FDI figures and performance

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FDI: As of August 2020, Binh Duong has 3,889 valid FDI projects (USD 35.06
billion), taking the 3rd position in attracting FDI capital nationwide.

Typical FDI Investors: Colgate-Palmolive (USA), Procter & Gamble (USA),

Uniliver (U.K and Netherlands), Kumho Tires (Korea), Far Eastern Polyester
(Taiwan), Kirin – Acecook (Japan).

Attractive investment sectors: Industries (IT, electronics, micro-electronics,

biotechnology, robotics, 3D printig, electric vehicles, supporting industries,
consumer goods, food and beverage processing). Services such as logistics,
warehouse, cold storage, modern infrastructure (urban area, trade center,
education and training).

2.2.2. Opportunities for FDI

As a large industrial area, Binh Duong is the gateway to trade with Ho Chi
Minh City, and surrounding areas thanks to its strategic location, superior
infrastructure and proximity to international airports, seaports and commercial
service centers.

In recent years, the economic growth rate of Binh Duong continues to

increase impressively, forming many industrial parks and attracting hundreds
of global leading corporations.

Beside grasping the new development trend, Binh Duong has made a
breakthrough in developing a Smart City aiming at improving the added value
for the economy, shifting towards a knowledge and digital economy. Focusing
on developing knowledgeable human resources, applying science and
technology (S&T) and promoting creative startups, connecting with logistics
and ICT infrastructure, synchronizing on databases, innovative ecosystems
based on close cooperation between the government, enterprises and training
institutes/schools. Along with that, Binh Duong focuses on investing in
building Science and Technology Industrial Park to attract investment from
enterprises, corporations and investors with high technology level and added
value.

2.2.3. Challenges for FDI

Binh Duong, Vietnam, with its burgeoning industrial landscape and strategic
location, holds considerable appeal for foreign investors. However, this
dynamic market also presents a unique set of challenges that require careful
consideration and a proactive approach.

Infrastructure Bottlenecks:

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  Congestion Concerns: While transportation infrastructure is robust,
rapid development can lead to traffic congestion, impacting operational
efficiency and logistics. Investors should factor in potential delays and
consider alternative transportation solutions.
 Infrastructure Expansion: Ongoing infrastructure projects aim to
address existing limitations, but temporary disruptions might occur.
Maintaining close communication with local authorities and staying
informed about construction timelines is crucial.
 Public Transportation Opportunities: While private vehicles are
common, limited public transport options can hinder employee mobility.
Exploring solutions like shuttle services or partnering with local
authorities to improve public infrastructure can foster a more connected
workforce.
Regulatory Hurdles:
 Navigating Complexity: Vietnam's legal and administrative processes
can be intricate for foreign investors. Partnering with experienced legal
and consulting firms can streamline procedures and ensure
compliance.
 Regulatory Dynamics: Frequent policy changes and amendments
necessitate an awareness of the evolving regulatory landscape.
Regularly consulting with relevant authorities and industry experts is
essential to stay informed and adapt strategies accordingly.
 Transparency and Anti-Corruption Measures: While efforts are being
made to enhance transparency, a proactive approach to mitigating
corruption risks is key. Implementing clear internal policies and
conducting thorough due diligence on local partners are crucial
safeguards.
Workforce Considerations:
 Bridging the Skills Gap: While Binh Duong boasts a large workforce,
specific industries might face skill shortages. Investors should consider
investing in skills development programs for existing employees or
exploring talent acquisition strategies beyond the local market.
 Competitive Talent Landscape: Retaining skilled talent requires offering
competitive compensation packages, career development
opportunities, and fostering a positive work environment.
Understanding Vietnamese work culture and adapting management
styles can be advantageous in building strong teams.
 Cultural Nuances: Cross-cultural awareness is key to effective
communication and team dynamics. Investing in cultural training for
expatriate personnel and fostering open communication channels with
local employees can contribute to a more productive and harmonious
work environment.
Economic Volatilities:

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  Global Market Fluctuations: Vietnam's export-oriented economy is
susceptible to global economic downturns. Diversifying investment
portfolios and implementing risk management strategies are crucial to
weathering economic fluctuations.
 Currency Exchange Risks: The Vietnamese dong can be volatile,
exposing foreign investors to currency exchange risks. Employing
hedging strategies and exploring local financing options can help
mitigate these risks.
 Sectorial Dependencies: Binh Duong's economy relies heavily on
specific sectors like manufacturing and tourism. Investors should
diversify their portfolios across different sectors to minimize exposure
to downturns in any specific industry.
Additional Considerations:
 Land Availability and Costs: Prime locations within industrial parks
might be limited, and land costs can be high. Conducting thorough land
feasibility studies and exploring alternative locations is crucial for
optimizing land use and managing costs.
 Environmental Sustainability: Balancing industrial development with
environmental protection is a priority. Investors should adopt
sustainable practices and ensure compliance with environmental
regulations.
 Financing Options: Accessing loans and other forms of financing might
be more complex for foreign investors compared to domestic
counterparts. Exploring various financing options and establishing
relationships with local banks can facilitate capital access.
Success in Binh Duong requires a comprehensive understanding of the
market, a proactive approach to mitigate challenges, and a commitment to
responsible and sustainable practices. By partnering with experienced local
professionals, staying informed about the evolving landscape, and
implementing adaptable strategies, foreign investors can navigate the
challenges and unlock the vast potential of this dynamic province.

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