Binh Duong Land Lease Reduction Policy: Impact and Development Strategy

Policy Overview

To attract investment and promote economic development, Binh Duong province has recently issued a land lease fee reduction policy for enterprises operating in priority investment sectors. This is a key strategy to maintain the province's position as one of the most attractive business environments in the country.

According to the new resolution, land lease fees will be waived for production and business projects that meet one of the following two criteria:

• Projects classified under the socialization categories, scale standards, and social standards determined by the Prime Minister.

• Non-profit projects.

After the basic construction phase is completed, these projects can continue to enjoy reductions under Decree No. 103 of the government, with specific benefits depending on individual circumstances.

Scope and Reduction Standards

The preferential policy applies differently across various regions of Binh Duong:

• Northern Region (including Dau Tieng, Bau Bang, Phu Giao, and Bac Tan Uyen districts): Investment projects in these areas are eligible for full exemption of land lease fees throughout the rental period.

• Southern Region (including Thu Dau Mot City, Thuan An City, Di An City, Ben Cat Town, and Nam Tan Uyen District): International joint education institutions (multi-level educational establishments) and environmental projects (excluding crematoriums and electric cremation facilities) are fully exempted from land lease fees.

• Other Environmental Projects (including crematoriums and electric cremation facilities): These projects receive a 50% reduction in land lease fees.

However, this policy does not apply to industries such as hazardous waste treatment, large-scale domestic wastewater treatment, waste collection and centralized recycling, and renewable energy production from wind, solar, tidal, geothermal, and other sources.

Additionally, Binh Duong actively attracts sustainable development enterprises, especially in high-tech industries, clean industries, and logistics, to promote green economic growth while ensuring environmental protection.

Economic and Social Impact

The land lease fee reduction policy not only eases financial burdens on businesses but also fosters further investment inflows into Binh Duong. The province expects to maintain double-digit economic growth rates in 2025 and beyond through these incentives.

According to data from the Ministry of Planning and Investment, as of the end of 2024, Binh Duong ranked second nationwide in attracting foreign direct investment (FDI), with a total of $42.39 billion. In just the first two months of 2025, the province attracted nearly $1 billion in new FDI, bringing the total number of FDI projects to nearly 4,400, concentrated mainly in 29 industrial zones and clusters.

Currently, the land lease rate in Binh Duong's industrial zones exceeds 93%, indicating strong investment demand. To maintain this attractiveness, in addition to land lease reductions, the province actively implements measures to improve the investment environment:

• Simplifying administrative procedures to shorten investment approval times.

• Upgrading infrastructure, particularly enhancing connectivity with Ho Chi Minh City and surrounding areas.

• Enhancing workforce quality to meet business needs.

• Expanding logistics centers and high-tech industrial zones to foster high-value-added industries.

National Context and Impact

Binh Duong's land lease reduction policy coincides with the Ministry of Finance's consultation process on drafting regulatory decrees related to the 2024 Land Law. These decrees define conditions for land lease fee reductions nationwide. Additionally, the Ministry of Finance has proposed continuing a 30% reduction in land lease fees for businesses, individuals, and households in 2025, consistent with reductions from 2021 to 2024.

Thus, Binh Duong not only benefits from national policies but also maximizes its competitive advantage through tailored incentives. With a transparent legal system, a stable business environment, and effective enterprise support mechanisms, the province continues to be a top destination for domestic and foreign investors.

Conclusion

The land lease fee reduction policy enhances Binh Duong’s investment appeal while providing long-term economic and social benefits. This policy creates favorable conditions for businesses to expand, increase production capacity, and improve service quality.

With a clear development strategy, Binh Duong is gradually becoming a regional economic hub, attracting major global enterprises. This is not only a significant opportunity for the province's development but also serves as a model for other localities nationwide.