Since 1/7, a new Ho Chi Minh City has emerged from the merger of the former Ho Chi Minh City, Binh Duong, and Ba Ria-Vung Tau provinces. This has created an industrial center with a scale of nearly 930,000 trillion VND, accounting for over 25.52% of the country's total industrial value as of 2024.

Tran Viet Ha, deputy head of the Ho Chi Minh City Export Processing and Industrial Zones Authority (Hepza), stated that after the merger, the new city has 66 export processing and industrial zones, covering over 27,000 hectares.

"According to the 2050 master plan, the city will have 105 export processing and industrial zones with a planned area of over 49,000 hectares, making it the nation's leading industrial center," Ha said at the "Golden Opportunities from Ho Chi Minh City Industrial Real Estate" seminar on 17/7.

Tran Viet Ha, Hepza’s deputy head, speaking on 17/7. Photo: ITPC

Tran Viet Ha, Hepza’s deputy head, speaking on 17/7. Photo: ITPC

Dr. Truong Minh Huy Vu, director of the Ho Chi Minh City Institute for Development Studies (HIDS), believes the new Ho Chi Minh City "has the potential to become a modern, sustainable, and high-tech integrated industrial center for both the country and the region."

According to Vu, this potential stems from the unified investment policies, infrastructure, and tax incentives that benefit businesses in production and expansion. The strengths of each locality before the merger also allow for efficient resource combination.

Specifically, the former Ho Chi Minh City leads in innovation, Binh Duong specializes in manufacturing and processing, and Ba Ria-Vung Tau focuses on energy and maritime logistics. The diverse industries, ranging from food processing and electronics to mechanics and petrochemicals, create an environment that attracts FDI seeking a complete ecosystem.

Moreover, this economic powerhouse boasts the largest and most dynamic industrial business community in the country. By the end of 2024, the three former localities had nearly 45,000 industrial enterprises, accounting for almost 28.4% of the national total. "After the merger, Ho Chi Minh City has the potential to become a modern, sustainable, and high-tech integrated industrial center for both Vietnam and the region," Vu said.

Compared to the region, Dr. Do Thien Anh Tuan from the Fulbright School of Public Policy and Management, assesses that Ho Chi Minh City holds a strategic position in the global supply chain, facilitating trade connections with major economies.

The city's production, urban, and seaport ecosystem is increasingly integrated and multifunctional. Combined with a large domestic market, this helps maintain and expand production scale and attract investment. "Ho Chi Minh City possesses many favorable conditions to rise in the East Asian industrial competition," Tuan stated.

However, experts and businesses also highlight challenges that need to be addressed to unlock the city's industrial growth potential. Firstly, the slow development of ring roads, expressways, and logistics centers has resulted in a fragmented supply chain.

Dr. Nguyen Thanh Trong from Eastern International University, noted that the lack of synchronization in port-industrial zone connectivity is increasing logistics costs. Only about 15% of import-export goods passing through Ba Ria-Vung Tau are transported by inland waterways or rail, with the remainder reliant on roads.

Truong Minh Huy Vu recommends prioritizing the completion of Ring Road 3, Ring Road 4, the Ho Chi Minh City-Moc Bai expressway, the Bien Hoa-Vung Tau expressway, and the Ben Luc-Long Thanh expressway. These are key routes directly connecting industrial zones, research and development centers, international seaports (Cat Lai, Hiep Phuoc, Cai Mep-Thi Vai), and inland container depots (ICDs). "Reducing cargo transport time will contribute to lowering logistics costs, which currently account for 16-20% of the total cost," he explained.

Secondly, there is a need for developing supporting industries and improving the workforce's skill level. Vo Son Dien, chairman of the Binh Duong Supporting Industries Association (BASI), pointed out that many manufacturing businesses rely on imported parts, components, and materials.

According to Dien, support is needed for the development of basic material industries, encouraging large domestic enterprises to lead the supply chain, allocating resources to support industrial support startups, and developing international-standard quality testing centers.

Thirdly, there is the issue of human resources. Pham Van Viet, vice chairman of the Ho Chi Minh City Textile and Apparel Association, stated that businesses in the industry have digitized production lines and orders but lack suitable personnel. "We don't lack workers, but we lack people who can operate automated machinery, process production data, and control quality according to international standards," Viet explained.

VSIP Industrial Park in the former Binh Duong Province in 2/2022. Photo: Quynh Tran

VSIP Industrial Park in the former Binh Duong Province in 2/2022. Photo: Quynh Tran

According to HIDS, amidst the transition to digital industry and high technology, Ho Chi Minh City needs to establish an advanced technical training system with close links between universities, vocational colleges, businesses, and industrial zones. The key solution lies in developing a training network with high-tech vocational centers and expanding training in automation engineering, industrial design, digital control, smart logistics, and clean energy.

Furthermore, green and circular industries are a global trend, linked to Net Zero 2050 commitments. Experts suggest that Ho Chi Minh City should pioneer the development of new industries where production efficiency is tied to environmental responsibility and the complete digitization of processes.

Park Hee Sung, a representative of Kumho Tire Vietnam, mentioned that ESG (Environmental, Social, and Governance) is becoming a mandatory or strongly recommended standard. "We hope for more incentives to help businesses proactively invest in ESG, such as tax breaks, investment capital support, and training for ESG-specialized personnel and technology," Sung suggested.

According to Truong Minh Huy Vu, Ho Chi Minh City needs to promptly issue regulations on ecological industrial zone criteria. This should be combined with green and digital policies, such as applying ESG standards in investment approvals and prioritizing capital, land, and finance for businesses practicing green, clean, and smart operations.

Tran Viet Ha, Hepza’s deputy head, stated that from 2025 to 2030, export processing and industrial zones in Ho Chi Minh City aim to attract 20 to 21 billion USD in investment, with an average investment density of 8 to 10 million USD per hectare.

The city will focus on attracting four key industries with high technology content, substantial growth value, and environmental friendliness, along with potential and emerging strategic industries: electronics - semiconductors, artificial intelligence, machine learning, big data, blockchain, biotechnology, new materials, and environmental industries.

"Towards sustainable development, we are implementing a pilot project to transform the operational models of several export processing and industrial zones, particularly the Hiep Phuoc Industrial Park into an ecological model," Ha said.

Vien Thong