In the context of deepening international economic integration, Vietnam is becoming an attractive destination for foreign investors, particularly in the manufacturing sector within industrial parks (IPs). This article provides detailed information on the latest investment conditions applicable in 2025.
1. Overview of Foreign Investment in Vietnam’s Industrial Parks
Vietnam has achieved significant success in attracting foreign direct investment (FDI) into industrial parks, making a vital contribution to the country’s economic development.
As of the end of 2023, Vietnam had established 418 industrial parks with a total area of 219.1 thousand hectares, of which 298 were operational, covering approximately 155.3 thousand hectares. These industrial parks had attracted over 21,600 investment projects with a total capital of more than $318 billion, including 11,200 FDI projects with a total investment of $212 billion. Notably, enterprises within industrial parks contributed around 50% of Vietnam’s total export turnover and directly employed approximately 4.15 million workers, mainly concentrated in the Southeast region. These figures highlight the crucial role of FDI in the development of industrial parks in Vietnam and emphasize the need to continuously improve the investment environment to attract more high-quality projects in the future.
Importance of Understanding Investment Conditions
Understanding investment conditions is crucial for ensuring the efficiency and security of financial decisions. A deep comprehension of economic, political, legal, and market factors enables investors to make informed decisions, minimize risks, and maximize profits. Financial knowledge, particularly, serves as a solid foundation, helping investors analyze risks, choose suitable investment instruments, and manage assets effectively. A lack of understanding of investment conditions can lead to poor decisions, financial losses, and negative impacts on long-term investment goals. Therefore, equipping oneself with knowledge and insights into investment conditions is a key factor in achieving success and sustainability in this field.
2. Legal Framework for Foreign Investment
Key Legal Documents
Investment Law 2020 and its guiding decrees (Decree 31/2021)
Enterprise Law 2020
Decrees on investment incentives in industrial parks, including:
Currently, Vietnam has approximately 228 conditional business sectors, as stipulated in Appendix IV of the Investment Law, with some requiring a minimum capital investment (legal capital). The required minimum capital varies depending on the sector and location of investment. For example
1. Security service business (foreign investors contributing capital to Vietnamese security service enterprises) (Clause 4, Article 11, Decree 96/2016):
Minimum capital: VND 1 billion
The foreign investor’s capital contribution can only be used to purchase machinery and technical equipment for security purposes.
The valuation of machinery and technical equipment is conducted by authorities at the provincial level or higher, with valuation costs borne by the security service enterprise.
2. Airport business (Clause 2, Article 14, Decree 96/2016):
Minimum capital for establishing and maintaining a domestic airport enterprise: VND 100 billion
For an international airport enterprise: VND 200 billion
The foreign investor’s equity ownership must not exceed 30% of charter capital.
3.2 Permitted Investment Sectors
Priority industries within industrial parks include:
Supporting industries: Manufacturing components and spare parts for key industries such as electronics, automobiles, precision engineering, and textiles.
High-tech industries: Developing and applying advanced technologies in fields such as information technology, telecommunications, automation, new materials, and biotechnology.
Processing and manufacturing industries: Food processing, building materials production, mechanical engineering, electrical and electronic equipment, medical devices, and other industrial products.
Smart energy industries: Renewable energy production, clean energy, and smart energy solutions aimed at environmental protection and efficient resource utilization.
3.3 Prohibited Investment Sectors
Certain business activities are prohibited under Article 6 of the Investment Law, including:
Drug-related businesses
Business activities involving hazardous chemicals and minerals
Trading of specimens of endangered wild flora and fauna sourced from nature
Prostitution-related businesses
Human trafficking, trading of human organs, corpses, or fetuses
Human cloning-related business activities
Fireworks trading
Debt collection services
Additionally, from July 1, 2025, the Investment Law will expand the list of prohibited business sectors to include:
The project investor must carry out the assessment independently or through a qualified consulting unit.
The assessment must be conducted simultaneously with the preparation of the feasibility study report or an equivalent document for the project.
The results must be presented in an environmental impact assessment report.
Quantity: Each project must prepare one report.
A project must undergo an environmental impact assessment if it falls into one of the following categories (Article 30 of the Law on Environmental Protection):
Group I investment projects as specified in Clause 3, Article 28 of the 2020 Law on Environmental Protection.
Group II investment projects as specified in Points c, d, đ, and e of Clause 4, Article 28 of the 2020 Law on Environmental Protection.
Note: Emergency public investment projects under the Law on Public Investment are not required to conduct an environmental impact assessment.
5. Investment Registration Process
Step 1: Prepare Investment Documents
Investors must prepare a complete set of documents, including: (Clause 1, Article 31 of Decree 31/2021/ND-CP and Clause 1, Article 33 of the Investment Law 2020)
Enterprise legal documents
Investment project documents
Financial capability documents
A copy of land use rights documents or confirmation of land use rights (if not requesting land allocation or lease from the State).
Explanation of the technology used in the investment project under the Law on Technology Transfer (if the project requires technology appraisal).
Other documents related to the conditions and qualifications of the investor as required by law (if applicable).
Step 2: Identify a Suitable Industrial Park and Negotiate
Select an industrial park and negotiate with the infrastructure company regarding location, area, utilities, pricing, fees, and payment methods.
Step 3: Submit the Application to the Competent Authority (Article 34 of Decree 31/2021/ND-CP, Article 39 of the Investment Law)
Submit the application to the Department of Planning and Investment in the province where the investment project is implemented.
If the project is located in a high-tech zone with an existing Management Board, apply to the High-Tech Zone Management Board.
Step 4: Issuance of Investment Registration Certificate (Article 35 of Decree 31/2021/ND-CP)
Depending on the project type, investors must submit the necessary documents as required under Article 35 of Decree 31/2021/ND-CP to obtain the Investment Registration Certificate.
Investment in industrial parks in Vietnam is being facilitated through preferential policies and a transparent procedural framework. However, investors must thoroughly research and fully comply with the stipulated conditions to ensure project success.
At present, as international integration continues to deepen, investors in Vietnam are increasingly looking toward new and rapidly growing “markets” abroad. Trade promotion remains a top priority in the process of expanding into overseas markets. Accordingly, Vietnamese investors need to have a clear understanding of the available forms of outward investment to ensure a smooth initial entry.
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