GENERAL INTRODUCTION Hung Yen is located in the centre of the Red River Delta and borders six provinces and cities: Hanoi, Ha Tay, Bac Ninh, Hai Duong, Ha Nam, and Thai Binh. The province is developing a comprehensive road and waterway system and is proving an attractive effective destination for domestic and foreign investors. Following a thirty year union with Hai Duong province Hung Yen province was re-established on January 1st 1997. Since then the province has focused on developing the economy and improving the living standards of the people. Hung Yen is restructuring its economy, increasing the share of industry and services and reducing the share of agriculture and handicrafts. In 1996 agriculture, industry and construction services accounted for 60 percent, 15 percent and 25 percent of the economy respectively. By 2005 agriculture accounted for 30.5 percent of GDP and the contribution of industry and services had risen to 38 percent and 31.5 percent respectively. In recent years, Hung Yen has achieved an average GDP growth rate of over ten percent (12.8 percent in 2005) and GDP per capita is now over USD 500. The population (as of 2005) is over 1.1 million people, of which over 60 percent are of working age. To attract investment so as to increase production, create jobs and generate budget revenues Hung Yen has focused on developing its infrastructure, reforming its administrative procedures and creating an attractive investment environment. As of 2005, Hung Yen has seven industrial zones. Investment procedures (such as renting land, registering investments, seal making, registering tax identification numbers and obtaining bank loans) have been streamlined, creating ideal conditions for investors. By December 2005, there were 370 investment projects in the province with total registered investment capital of USD 1.104 billion, including 58 foreign invested projects with registered investment capital of USD 214 million and 312 domestic investment projects with total registered capital of USD 890 million. OVERVIEW OF ENTERPRISES As a result of the promulgation of the Enterprise Law in 1999 and the Revised Law on Foreign Direct Investment in 2000, there was a sharp increase in the number of enterprises established in Hung Yen province. In 2000, there were only 223 registered enterprises in Hung Yen (173 non-state enterprises, 47 state enterprises and three foreign invested enterprises). By the end of 2005 the total number of enterprises operating in the province was 713 (654 non-state enterprises, 26 state enterprises and 33 foreign invested enterprises). As the figures show government policy to equitize, sell, contract and lease state run enterprises resulted in a significant increase in the number of non-state enterprises and foreign invested enterprises. Type of enterprise Number (enterprise) Annual average capital for production and business (VND million) Labor (people) Annual net income (VND million) State owned enterprises 26 1,396,638 7,915 1,713,979 Non-state owned enterprises 654 6,686,643 36,996 8,091,568 - Private enterprises 211 351,200 4,134 709,114 - Collective enterprises 85 325,427 2,090 94,102 - Limited liability enterprises 296 4,050,246 20,010 5,017,595 - Joint-stock enterprises 62 1,959,770 10,762 5,137,681 - Partnership         Foreign invested enterprises 33 2,442,099 14,175 4,368,512 Total 713 10,525,380 59,086 14,174,059 Source: Hung Yen Statistics Yearbook (2006) Since July 1st 2006, the new Enterprise Law and Investment Law have come into effect, replacing the former legal system for enterprises and foreign investment. These two laws are intended to realize Vietnam’s commitments to reform the country’s administrative procedures and create an equal and transparent business and investment environment for domestic and foreign investors. As well as implementing the new laws Hung Yen has improved the capacity of provincial business administration agencies and developed a streamlined investment and business establishment mechanism to reduce time and costs for investors. Following Vietnam’s accession to the World Trade Organization (WTO) Hung Yen is ready to welcome investors.  Registration procedures for business establishment of investors are in accordance with the Enterprise Law. Procedures for investment registration of investors are in accordance with the Investment Law.