Hanoi: A Thriving Hub for Foreign Investment and Digital Transformation and aims at developing a digital government, economy, and society.
Hanoi, the capital of Vietnam, presents a robust investment profile, having attracted Foreign Direct Investment (FDI) worth US$2.28 billion in the first seven months of 2023. Hanoi benefits from a favorable business environment, robust infrastructure, and a skilled workforce. To enhance its investment attractiveness, Hanoi has embraced the National Digital Transformation Programme by 2025, with a vision extending to 2030, aimed at developing a digital government, digital economy, and a digital society.
Hanoi’s Investment Landscape: Hanoi is the largest economy in the Northern Key Economic Region (KER), encompassing six other provinces and cities, including Hai Phong, Quang Ninh, Vinh Phuc, Bac Ninh, Hai Duong, and Hung Yen. With a population of 8.2 million, it ranks as Vietnam’s second-largest city, following Ho Chi Minh City. Its competitive advantages include a conducive business environment, strong infrastructure, and a highly trained workforce, making it an attractive destination for business establishment.
FDI Inflows and Growth: Hanoi remains a prime destination for foreign direct investment (FDI). In 2022, it ranked among the top seven FDI destinations nationwide, attracting US$1.7 billion. The first seven months of 2023 saw Hanoi receive a total registered FDI capital of US$2.28 billion. Its gross regional domestic product (GRDP) grew by 5.97 percent in the first six months of 2023 compared to the same period in 2022. The expected full-year growth rate is anticipated to exceed 7 percent.
Hanoi and Ho Chi Minh City lead in the number of enterprises in Vietnam. In the first eight months of 2023, Hanoi registered 21,100 new enterprises with a combined capital of VND 208.8 trillion (US$8.65 million).
Provincial Competitiveness Index (PCI): The Provincial Competitiveness Index (PCI) assesses provincial authorities’ economic governance and their support for private sector development. Hanoi, although highly favored by investors for its favorable investment and business climate, has experienced declines in certain sub-indices over recent years compared to other rapidly developing provinces.
To address this, the Hanoi People’s Committee issued Directive No. 14/CT-UBND in 2021, aimed at improving Hanoi’s PCI ranking to reach the topmost ‘excellent’ tier. It emphasizes implementing measures to address the decline in crucial sub-indices: ‘time costs’ and ‘business support policies’. This includes online processing of business registration dossiers and ensuring timely completion of registration procedures.
Government Investment Promotion and Reforms: The Vietnamese government prioritizes investment promotion in high-value-added fields like manufacturing and processing, logistics services, tourism, education, healthcare, high-tech projects, preservation and processing industry, and clean energy, among others.
Efforts are underway to cultivate export markets and enhance the competitiveness of Hanoi’s products in trade promotion and agriculture.
Hanoi has also implemented policies and reforms to support businesses in overcoming economic challenges caused by COVID-19. This includes measures outlined in Plan No. 246/KH-UBND issued in November 2021 for economic recovery and pandemic control through 2023. The plan aims to bolster the healthcare system, sustain economic development, maintain a balanced budget, and improve the investment and business environment through administrative reforms.