An Investor’s Guide to Ba Ria-Vung Tau

Posted by Written by Dezan Shira and Associates Reading Time: 3 minutes

Ba Ria-Vung Tau is becoming an increasingly important manufacturing hub in Vietnam with a slew of big firms starting new projects in the province in 2023. Here’s why.

Located around 90 kilometers southeast of Ho Chi Minh City, Ba Ria-Vung Tau province is a coastal region buzzing with economic activity. Just a stone’s throw from Vietnam’s financial hub, Ba Ria-Vung Tau has access to a huge, youthful workforce, and it’s well connected to the city and one of Vietnam’s biggest ports in Tan Cang – Cai Mep International Terminal. Furthermore, it is just a short, two-hour drive away from Tan Son Nhat International Airport.

This puts it in good stead with neighboring foreign direct investment (FDI) hotspots like Dong Nai and Ho Chi Minh City. With this in mind, the Vietnam Briefing looks at how Ba Ria-Vung Tau stacks up in terms of doing business in Vietnam.

Public Administration Performance Index

The Vietnam Provincial Governance and Public Administration Performance Index (PAPI), initiated by the United Nations Development Programs, benchmarks Vietnam’s 63 provincial governments.

In 2022, Ba Ria-Vung Tau scored 41.99 on the PAPI Index. It achieved its best scores in ‘public service delivery’ and ‘Public Administrative Procedures’. It did, however, perform poorly in ‘environmental governance’ and ‘e-governance’. On ‘environmental governance’, in particular, its 2022 score of 3.20 signified an ongoing slide from 4.22 in 2018.

PAPI, Ba Ria-Vung Tau, 2018 to 2022

  2022 2021 2020 2019 2018
Participation at Local Levels 4.32 4.27 5.17 5.32 5.15
Transparency 5.18 5.04 5.80 5.78 5.63
Vertical Accountability 4.25 4.24 5.16 5.05 5.20
Control of Corruption 6.95 6.46 7.07 6.89 6.25
Public Administrative Procedures 7.08 6.75 7.55 7.37 7.36
Public Service Delivery 7.86 8.00 7.63 7.73 7.29
Environmental Governance 3.20 3.08 3.23 3.27 4.22
E-Governance 3.15 2.77 2.84 3.84 3.19
Total 41.99 40.61 44.45 45.25 44.29

Source: The Viet Nam Provincial Governance and Public Administration Performance Index

Provincial Competitiveness Index

The Provincial Competitiveness Index (PCI) was first conducted in 2005. The PCI measures the competitiveness of each of Vietnam’s provinces and ranks them against each other.

In 2022 Ba Ria-Vung Tau came in 4th place trailing only FDI heavyweights Quang Ninh, Bac Giang, and Hai Phong. This was a marked improvement from 2020 when the province came in position 15.

‘Time costs’ has been one key stand-out metric in Ba Ria-Vung Tau. From a score of 7.03 in 2018 it reached 7.81 in 2022. This was its highest score on any of the ten key metrics included in the PCI.

PCI, Ba Ria-Vung Tau, 2018 to 2022

  2022 2021 2020 2019 2018
Entry Costs 6.95 6.48 7.10 5.86 7.57
Access to land 7.66 7.01 6.85 6.95 6.41
Transparency 5.93 6.07 5.64 6.87 6.18
Time Costs 7.81 8.00 8.45 7.30 7.03
Informal Charges 7.79 7.23 7.04 6.46 6.37
Policy Bias 6.99 6.52 6.16 6.31 5.42
Proactivity 7.21 6.77 6.03 6.02 5.49
Business Support Policy 6.03 7.81 6.22 6.87 6.59
Labor Policy 6.31 6.56 7.07 6.82 6.47
Law & Order 7.41 7.08 6.52 6.32 6.37
PCI Scores 70.26 69.03 65.48 66.96 64.02
Ranking 4 9 15 16 21

Source: The Provincial Competitiveness Index 2022

Foreign direct investment

In 2023, Ba Ria-Vung Tau recorded US$2.52 billion worth of new investment in the province. This included 21 new projects alongside an increased investment in 29 existing projects.

Key projects announced for Ba Ria-Vung Tau include:

  • Japanese chemical maker, Tosoh, put forward a proposal for a 12-hectare factory in southern Vietnam’s Ba Ria-Vung Tau province. Vietnam exported US$4.9 billion in chemicals and chemical products in 2022 and imported US$17.6 billion in chemicals and chemical products in 2022.
  • Sweden’s Trelleborg Group announced in 2023 that it plans to build a US$37 million factory in Ba-Ria-Vung Tau that would be operational by 2026.
  • South Korea’s Hyosung announced plans to build a US$1 billion carbon fiber factory in the province. Hyosung, founded in 1966, is an industrial production conglomerate with business interests in a broad range of sectors, including chemicals, machinery, information technology, and construction.

More information

Ba Ria-Vung Tau, though less well known than some of its neighbors, has become a hub of manufacturing and investment activity. Firms from all over the world–Sweden, Japan, and South Korea, for example–are establishing themselves in the province. This is for a number of reasons including its public service delivery, public administrative procedures, and time costs.

Foreign firms considering a Vietnam market entry would do well to think seriously about Ba Ria-Vung Tau as an option. That said, there are a number of similar, good-value options among Vietnam’s other provinces. With this in mind, foreign firms should contact the business advisory experts at Dezan Shira and Associates for an on-the-ground assessment of which location is right for them.

About Us

Vietnam Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Asia, including ASEAN, China, and India. For editorial matters, contact us here and for a complimentary subscription to our products, please click here.

Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Vietnam and the Asian region. We maintain offices in Hanoi and Ho Chi Minh City, as well as throughout China, South-East Asia, Dubai, and India. For assistance with investments into Vietnam, please contact us at vietnam@dezshira.com or visit us at www.dezshira.com.