Being of the most important regions for the economic development of Vietnam, the Central Highlands are now in a phase when the provinces that are part of this region need to attract more investments. From a broad perspective, the Central Highlands are very promising to foreign investors, especially in three sectors: agriculture, tourism and renewable energies. Most of our readers are probably already familiar with Lâm Đồng province and its capital Đà Lạt, but very few people know about Đắk Nông province which has recently “awakened” and seriously opening itself to investments since 2018.

In 2018 the People's Council of Đắk Nông province has worked a lot on how to attract investments in this province, and it has issued resolutions and made administrative endeavours in order to make the province more attractive to local and foreign investors.

Therefore the purpose of this article is to outline the main incentives to invest in Đắk Nông that were announced in 2018 in Resolution 06/2018/NQ-HĐND of the People's Council of the province.

General Principles on investments in Đắk Nông province:

1. Investors shall get free support in order to carry out administrative procedures from the beginning of the project until the project is put into operations.
2. The administration of the province shall address and solve administrative procedures and difficulties during the project implementation process.
3. The administration of the province shall encourage investors to establish their own legal entity in Đắk Nông Province.
4. Investment projects shall comply with regulations on environmental protection.
5. The administration of the province shall give priority to projects using local labour.

Investment incentives for technical infrastructure items:

The province shall support investment projects in industrial zones, agricultural zones using high technologies by funding the construction of infrastructure items such as roads, drainage systems, centralized wastewater treatment systems, in the following way:

• Fund 30% of the total cost of a completed investment project (based on its settlement) for the above-mentioned items associated with social activities, but not exceeding 2 billion VND/project.
• Fund 20% of the total cost of completed investment project (based on its settlement) for the above-mentioned items not associated with social activities, but not exceeding 1 billion VND/project.

For projects leasing land in industrial zones, industrial clusters, agricultural zones using high technologies, the province shall provide investors with the following incentives:

• Payment exemption for the land lease until the completion of the project (but not exceeding 24 months). In case the project is delayed for objective reasons, the payment exemption can be reconsidered and extended, but not more than 36 months.
• 50% lease reduction during two years following the release of the first product sold on the market.

All the above-mentioned incentives shall take the form of land lease and infrastructure lease deductions in industrial zones, industrial clusters, agricultural zones using high technologies for small and medium investors.

Investment incentives for tourist accommodation facilities:

Incentives for investments in new constructions, in expansion and in improvement of the quality of services associated with tourist accommodation facilities, approved as such by competent State Bodies, that meet three stars or higher standards, shall be as follows:

• A tourist accommodation meeting the 3 stars standard shall be supported as follows: 10 million VND/bedroom, but not exceeding 500 million/establishment.
• A tourist accommodation meeting the 4 or 5 stars standard shall be supported as follows: 20 million VND/bedroom, but not exceeding 1 billion/establishment.

Incentives to develop Community Tourism:

• Support villages and ethnic areas with homestay businesses (hosting capacity of minimum 20 people): 100% of the fees for building a public toilet and installing a direction sign board will be covered, but not exceeding 200 million/village or ethnic area.
• Support homestay businesses and agritourism (hosting capacity of minimum 10 hosts): 50% of the fees for building toilets, for the rooms equipment, but not exceeding 200 million/household.

Incentives for high technologies projects:

High technologies projects, industrial projects and agricultural projects using high technologies can benefit from the following incentives:

• Help to fund the construction of infrastructure items such as: roads, drainage systems, centralized wastewater treatment systems by funding 30% of total cost of the completed project (based on its settlement) for the above-mentioned items, but not exceeding 3 billion VND/project.

Support training and develop human resources:

• Hire specialists: fund 30% of the specialists labour contracts.
• Local workers involved in high technologies projects that want to attend professional training courses in Vietnam and abroad shall receive a maximum financial support of 10 million VND/worker with a limit of 15 workers per training course.

Support for technology and equipment:

• Support in technology transfers, investments in machinery, investments in equipment, in test production by funding 30% of total cost of the completed project (based on its settlement) for the above-mentioned items, but not exceeding 2 billion VND/project.
• Agricultural projects using the following technologies: plant hybridization, livestock hybridization, aquaculture species hybridization with the aim to create species with improved characteristics, tissue culture multiplication, radioactive mutations, shall be granted a piece of land in order to implement their project.

Support for the purchase of machinery, processing equipment, packaging and storage equipment:

• Cooperatives purchasing machinery and agricultural product processing equipment shall benefit from a 50% funding of the purchase, although the funding shall not exceed 200 millions VND/cooperative.
• Cooperatives investing in machinery, packaging equipment, vaccuum extractors, printers shall benefit from a 50% funding of the purchase, although the funding shall not exceed 50 millions VND/cooperative.

Credit support:

• Businesses with investment projects in agriculture and in rural areas shall be entitled to receive support for the payment of their interest rates on commercial loans after the completion of their project:
• The level of support shall be equal to the difference between the commercial loan interest rate and the state credit interest rate, which shall be calculated based on the actual balance at the time of the submission of the supporting dossier.
• The support period shall be calculated from the starting date of the disbursement under the credit contract until the date of the submission of the supporting documentation to the competent authorities.
• Projects which imply participation in a value chain are entitled to interest rates support according to the production cycle of products.
• Loan limit entitled to interest rate support: according to the amount of the loan, but not exceeding 70% of the total investment.
• Projects on the list of encouraged projects are entitled to preferential investment loans from the Đắk Nông Province Investment and Development Fund, which level of support will be equal to the interest rate difference. The support period shall not exceed 3 years from the disbursement date of the first loan, and it shall not exceed 1 billion VND/project.

Support for trade promotion, registration of establishment of industrial property rights, traceability of products:

• Support for participation in the Central Highlands Fair: 10 million VND/time /business, cooperative/year.
• Support for participation in national (or international) fairs held in Vietnam: 20 million VND/time/enterprise, cooperative/year.

Support for participation in international fairs (held overseas):

• Fairs held in Southeast Asia and in China: 50 million VND/time/ business, cooperative/year.
• Fairs held in other countries: VND 100 million/ time/business, cooperative/year.
• Cover 100% of the costs for the creation, the registration and the protection of trademarks and industrial designs. This kind of support shall be granted only once, and the level of financial support shall not exceed 50 million VND/product or service.

Incentives for training and human resources development:

Investors, using a minimum of 20 local workers, that want those workers to attend professional training courses below 3 months (under the condition that the investor will hire those trained workers for a minimum of 3 years) shall be granted a one time financial support of maximum 1.000.000 or 1.500.000 VND/worker/training course depending on the nature of the training course.

Incentives for households and individuals:

• Households and individuals investing in safe agricultural production using greenhouses are entitled to a financial support for their greenhouse amounting to 30.000 VND/m2 but exceeding 30.000.000 VND/household or individual.
• Households and individuals investing in safe agricultural production using water saving irrigation and drip irrigation technologies are entitled to a financial support based on the total investment costs, but exceeding 10.000.000 VND/household or individual.

Land lease exemption and reduction for projects involved in social and cultural spheres:

• Projects involved in social and cultural spheres in urban areas are entitled to a 50% reduction in land lease.
• Projects involved in social and cultural spheres in rural communes are exempted from land lease.

Incentives for investments in small and medium-sized innovative start-ups:

Đắk Nông province has a Provincial Investment and Development Fund, and every year the Provincial People's Committee shall consult the People's Council to define the yearly amount of funding for small and medium-sized innovative start-ups.

Incentives for charities, humanitarian actions and non-profit activities:

• Charity projects, humanitarian actions and non-profit activities shall be exempted from land lease.
• The provincial budget shall allocate funds to indemnify investors in charities, humanitarian actions and non-profit activities for all the land clearing and allocation costs.

If you would like to know more details about the investments conditions and incentives in Đắk Nông province, we encourage you to visit the official website of Đắk Nông People's Committee at https://daknong.gov.vn/web/dak-nong-english/home.

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