Issuing new investment support policies: "Giving wings" to eagles
With the issuance of new investment support policies, including the first-ever implementation of cash support for investors, Vietnam will have more opportunities to attract investment. Eagles will be given wings to fly to Vietnam.
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| LG Display has increased its investment capital by another 1 billion USD in the factory in Trang Due Industrial Park (Hai Phong) by the end of 2024. |
Breakthrough mechanism
After much waiting, on the last day of 2024, the Government officially issued Decree No. 182/2024/ND-CP on the establishment, management and use of the Investment Support Fund, in time to apply for the 2024 fiscal year, usually settled in early 2025.
“This is something we have been waiting for a long time,” said the leader of a large-scale foreign-invested enterprise in Vietnam, adding that this will make it easier for the company to make decisions on expanding investment in Vietnam in the future.
Similarly, Mr. Bui Ngoc Tuan, Deputy General Director of Tax and Legal Consulting Services, Deloitte Vietnam expressed his joy that after more than 1 year of research and learning from the experiences of advanced countries, Vietnam has had investment support policies in line with the general trend of the world.
Mr. Bui Ngoc Tuan even called the decision to establish the Investment Support Fund a “strategic initiative”. According to Mr. Tuan, this strategic initiative has emphasized the Government’s commitment to promoting the policy of attracting substantial investment, focusing on major projects, thereby enhancing innovation capacity, making Vietnam a center of advanced technology in the world, and continuing to put Vietnam on the list of priority countries for development of the “eagles”.
Deloitte Vietnam is one of the units that the Ministry of Planning and Investment consulted on policies during the process of developing the Draft Decree on the Investment Support Fund. Deloitte has supported Vietnam from the beginning to implement investment support policies based on costs, instead of income as currently, and proposed the need for cash support policies as many economies are implementing. Deloitte experts even said that cash support is the "door" for Vietnam to attract "eagles".
And currently, it is true that many breakthrough investment support mechanisms have been issued. Specifically, according to the provisions of Decree 182/2024/ND-CP, the Vietnamese Government is willing to support costs for training and human resource development; R&D costs; investment costs for creating fixed assets; costs for manufacturing high-tech products; investment costs for social infrastructure works and other cases decided by the Government. Along with that, the Government also stipulates specific criteria, as well as different levels of support, depending on the ability to meet the set criteria.
One of the notable points is that, at most, businesses can be supported up to 50% of the initial investment cost of the project, if there is a project to invest in an R&D center in the fields of semiconductor chips, AI... Businesses will also be supported up to 3% of the added production value of high-tech products in the fiscal year, if they meet certain criteria, such as achieving a minimum revenue of VND 200,000 billion, a minimum workforce of 10,000 people, the added value rate of high-tech products reaching a minimum of 30%...
“Wings” for the eagle
When Decree 182/2024/ND-CP was just issued, Bac Ninh – one of the “magnets” attracting foreign investment in the Northern region – granted investment registration certificates to a series of projects. Notably, there is the billion-dollar project of Samsung Display.
In fact, this project was committed to investment last year and was only officially granted an investment registration certificate at the beginning of this year. However, the project has also contributed significantly to affirming the attractiveness of Vietnam as an investment destination for international investors.
Recently, not only Samsung, but also many other large investors have come to invest. A report from the Foreign Investment Agency (Ministry of Planning and Investment) shows that in 2024 alone, there have been a number of notable projects of the "eagle", such as the 1.07 billion USD capital increase project of semiconductor manufacturer Amkor, the 1 billion USD capital increase project of LG Display... Not to mention, there are also projects worth hundreds of millions of USD of Foxconn, Goertek, Luxshare...
This is the first time Vietnam has implemented a new, groundbreaking incentive mechanism, marking an important milestone in its efforts to attract more world-class high-tech enterprises to invest in Vietnam. 
– Mr. Bui Ngoc Tuan, Deputy General Director of Tax and Legal Consulting Services, Deloitte Vietnam
This trend is positive, but the Ministry of Planning and Investment believes that although foreign investment attraction has continued to grow in recent years, the number of large-scale projects with high-tech content remains modest. Currently, Vietnam has 110 valid foreign investment projects with an investment capital of over 500 million USD; of which only 27 are in the high-tech sector. Particularly in the period from 2013 to present, there have been only 59 large-scale projects of over 500 million USD, an average of less than 5 projects/year.
In that context, the global minimum tax, which will be applied from 2024, will also affect Vietnam's competitiveness. Some businesses have considered new investment and expansion plans in Vietnam. Some large corporations have come to survey and research investments, but have not yet chosen Vietnam or are waiting to monitor the Government's policy response.
And now, Vietnam's policy response has become clearer, with the establishment of the Investment Support Fund and the promulgation of policies to support competition and innovation. This will contribute significantly to increasing the attractiveness of the investment environment in Vietnam, thereby attracting more large-scale projects, especially in the fields of semiconductors and AI.
Minister of Planning and Investment Nguyen Chi Dung has always affirmed the important role of establishing the Investment Support Fund. He often emphasizes to foreign investors that the investment support policy will soon be issued so that they “do not need to go anywhere and tire their feet”.
Not only is there no need to go anywhere, but there will certainly be many “eagles” that will “spread their wings” to fly to Vietnam. NVIDIA’s story is still a great achievement for Vietnam in attracting foreign investment in 2024.
“This is a historic turning point for Vietnam, making our country a leading AI research and development center in Asia,” said Minister Nguyen Chi Dung, adding that the presence of NVIDIA will create a boost to attract more high-tech enterprises to Vietnam.
In that context, new investment support policies will be a more certain guarantee for the potential and opportunities of investors in the Vietnamese market. Therefore, eagles will come more and more!
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