Tay Ninh: Promising for Investors in the Greater Mekong Subregion
- Tay Ninh province is one of the major industrial hubs in Vietnam’s Southern Key Economic Region, supported by developing infrastructure and industrialization.
- The province has attracted a large amount of foreign investment in infrastructure at industrial zones.
- To attract investment, the province facilitates the growth of logistics, international cooperation, and developing in-depth industries.
Vietnam’s Tay Ninh province located in the Southern Key Economic Region (SKER) acts as a key connection point between Ho Chi Minh City and Cambodia’s capital Phnom Penh, sharing a border with Cambodia at Moc Bai and Xa Mat border gates, the main trade centers between the two countries. The province is also on the East-West Corridor, part of the Trans Asia route linking Vietnam with Laos, Thailand, and Myanmar.
The SKER is one of four key economic regions which cover most economic and investment hubs in the country. The SKER consists of Tay Ninh along with Ho Chi Minh City, Binh Duong, Dong Nai, Long An, Ba Ria-Vung Tau, Binh Phuoc, and Tien Giang.
The province is located at the intersection of arterial traffic routes in the Greater Mekong Sub-region (GMS) with the southern economic corridor running from the Dawei province of Myanmar through Thailand and Cambodia to Vietnam’s provincial seaports Ba Ria – Vung Tau. The GMS is a trans-national region along the Mekong River basin in Southeast Asia with a program that supports trade and high-priority projects in the six nations along the Mekong River.
In 2020, Tay Ninh’s gross domestic product (GRDP) increased by 3.9 percent over the same period. Of this, 75.5 percent of the GRDP is attributed to the share of industrial production and services following the fast-growing pace of industrialization.
Ranking high in the PCI
According to the Provincial Competitive Index (PCI) 2020, Tay Ninh ranks 21 out of 63 provinces. The ranking was a drop by six places compared to 2019. However, Tay Ninh remains in the group of provinces and cities with the best PCI results and continues to target higher scores through facilitating economic growth and attracting foreign investment.
Compared with the previous period, the province increased sharply in both the number of newly registered enterprises and the amount of attracted investment capital.
Foreign investment attraction
As of April 2021, Tay Ninh had attracted US$427.54 million in foreign capital, up 28 percent over the same period of 2020. Industrial parks and border-gate economic zones in Tay Ninh have attracted 362 foreign and domestic investment projects with total registered investment capital of US$7,486 million.
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Within the same period, the authorities of Tay Ninh signed investment cooperation agreements in agriculture, trade, science, and technology with several provinces in Cambodia as well as Gimhae and Chungju cities in South Korea.
The province prioritizes attracting large investment projects with advanced technology, green projects, projects with modern management, high value-added content, spillover effects, and connections to global production and supply chains.
Tay Ninh is an attractive investment destination with a strategic geographical location, large land capacity, and costs advantages. Compared to Binh Duong with the same travel distance to Ho Chi Minh City, Tay Ninh has a clear advantage in transportation costs for goods exported from Ho Chi Minh via Tay Ninh to Cambodia and Thailand.
Tay Ninh is an area with transitional terrain from the South-Central Highlands to the Mekong Delta, where the land is flat and hard, especially in the Phuoc Dong commune area. It is suitable for construction without having to implement pile driving, a technique of installing piles into the soil to build foundation for large infrastructures, which helps save construction costs and time.
According to Savills Vietnam, the average land rent price and land lease price in Phuoc Dong IP is US$83/m2 and US$90/m2 respectively. This is significantly lower than the prices in industrial zones in adjacent provinces. For example in Binh Duong, prices are US$107/m2, while in Dong Nai they are US$98/m2, and US$123/m2 in Long An.
Opportunities in Go Dau District and Trang Bang town
Go Dau District and Trang Bang town are key locations in the province with a high foreign investment attraction rate. As of April 2020, Trang Bang town has attracted the highest number of FDI projects, with 203 projects, accounting for 62.1 percent of the total FDI projects in Tay Ninh, followed by Go Dau district with 67 projects, accounting for 20.4 percent.
In the future, the province is planning to focus on implementing infrastructure constructions, including the construction of the Ho Chi Minh – Moc Bai Expressway.
The proposed construction is highlighted in Tay Ninh’s 2021-2025 infrastructure plan, expected to enhance connection with other ASEAN countries. The 53 km expressway, including nearly 24 km through Ho Chi Minh City, will run from Ring Road No.3 in the city’s Hoc Mon District to Tay Ninh’s Moc Bai International Border Gate with Cambodia.
It is expected to shorten the travel time between Ho Chi Minh City and Tay Ninh by half and ease traffic congestion on National Highway No. 22, the only road currently connecting Ho Chi Minh City and the Moc Bai international border gate in Tay Ninh.
The construction is expected to be in two phases with the first phase completed in 2025, costing around US$686 million with four lanes, while the second involves expanding to six to eight lanes.
The total investment capital in the project has increased drastically since its approval in August 2021 from roughly US$430 million to US$695.3, including US$258 million for site clearance, compensation, and resettlement costs in Ho Chi Minh City. At the end of 2021, a pre-feasibility report will be submitted to the Prime Minister for approval for additional investment in the project.
Industrial park spotlight – Phuc Dong IP
Among several industrial parks, the Phuoc Dong Industrial Park (IP) is the largest IP in Tay Ninh with an area of about 2,190 hectares along with complete infrastructure, suitable for investment projects requiring large areas of vacant land.
Phuoc Dong IP, invested by Sai Gon VRG Investment Corporation, is considered an industrial-commercial-residential complex with an environmentally friendly manufacturing environment and a modern and creative living area.
Phuoc Dong IP is adjacent to the future Ho Chi Minh – Moc Bai Expressway, promising fast travel between the IP and Ho Chi Minh city. The industrial park area spans over Go Dau district and Trang Bang town.
Phuoc Dong IP has full essential infrastructure for residents, such as hospitals, schools, education centers, and entertainment centers. The investor Sai Gon VRG also prioritizes environmental protection to create a balanced healthy lifestyle and working space.
Additionally, with good infrastructure connectivity with Ho Chi Minh City and Thanh Phuoc River Port, the logistic joint between Tay Ninh and the Central Highlands provinces, Phuoc Dong IP has significant advantages in location and attraction to investors.
In the medium term, Tay Ninh is expected to promote the application of information technology and modernize public administrative services, thereby drastically improving its PCI.
The province currently has three international border gates to Cambodia, contributing to developing in-depth industry, logistics services, and cross-border economy. The recent opening of the Tan Nam international border gate highlights the province’s aim to foster eco-tourism, serving both localities’ economic growth and job creation. These gates will continue to promote Tay Ninh’s economic, education, cultural and trade cooperation with Prey Veng and other localities in Cambodia.