China+1: Which Provinces Are Winning Vietnam's FDI Race in 2026?

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China+1: Which Provinces Are Winning Vietnam's FDI Race in 2026?

The China+1 strategy — diversifying supply chains beyond China — is no longer a trend. It has become a strategic imperative for virtually every multinational corporation. And Vietnam continues to be the most sought-after destination in Southeast Asia.

In just the first four months of 2026, Vietnam attracted FDI across 29 of its 34 provinces and cities — with total registered capital reaching tens of billions of USD. But capital does not flow evenly. So which provinces are winning this investment race?

1. Why Vietnam Is the Top China+1 Destination

Before diving into province-level analysis, it is worth understanding the structural advantages that keep drawing global corporations to Vietnam:

• Competitive labour costs: 30–40% lower than China, with productivity that outperforms many lower-cost alternatives

• Extensive FTA network: CPTPP, EVFTA, RCEP — preferential market access to the EU, US, Japan and South Korea

• Strategic location: at the heart of Southeast Asia's supply chain corridor, directly bordering China

• Strong FDI incentives: corporate income tax exemption for the first 2–4 years, 50% reduction for the following 4–9 years

• Maturing industrial infrastructure: occupancy rates at 89% in the South and 80% in the North (Savills, 2024)

The FDI sector currently contributes approximately 20% of Vietnam's GDP and accounts for over 70% of total export turnover — reflecting an increasingly deep integration into global supply chains.

2. FDI Rankings by Province — Q1/2026

According to the Foreign Investment Agency (Ministry of Planning and Investment), the top six destinations for FDI in Q1/2026 were:

* Source: Foreign Investment Agency — Ministry of Planning and Investment, Q1/2026

3. Province-by-Province Analysis

�� Thai Nguyen — The Surprise National Leader

Thai Nguyen surged to the top of the national rankings with USD 5.72 billion in FDI in Q1/2026, reaching USD 6 billion across the first four months of the year — significantly ahead of all other localities. The primary driver was Samsung Electro-Mechanics' USD 1.2 billion FCBGA circuit board manufacturing project, producing advanced semiconductor components for smartphones and computers.

• Strengths: Complete Samsung supply ecosystem, abundant skilled workforce, lower land costs than Bac Ninh and Hai Phong.
• Best suited for: Electronics manufacturing, semiconductors, advanced technology components.

�� Ho Chi Minh City — 220% Growth Surge

Ho Chi Minh City attracted nearly USD 2.9 billion in FDI in Q1/2026 — an increase of 220% year-on-year. This represents the strongest growth rate in the city's FDI history, driven by large-scale projects in technology and financial services.

• Strengths: Comprehensive business ecosystem, high-quality talent pool, international seaport and airport connectivity.
• Best suited for: Technology, high-value logistics, data centres, financial services, professional services.

�� Nghe An — The Rising Star of Central Vietnam

With the USD 2.2 billion Huynh Lap LNG power plant project (South Korea), Nghe An entered the top three national FDI destinations for the first time. The province is emerging as a cost-efficient location for large-scale manufacturing and energy projects.

• Strengths: Low land and labour costs, ample industrial land reserves, proximity to Cua Lo seaport.
• Best suited for: Heavy manufacturing, energy, large-scale garment and footwear production.

⚡ Bac Ninh — Vietnam's High-Tech FDI Capital

Despite ranking fourth in new registered capital in Q1/2026, Bac Ninh retains its position as the second-largest FDI destination nationally on a cumulative basis, with over USD 49.4 billion in total registered investment. The province is Vietnam's largest electronics and semiconductor manufacturing hub, home to Samsung, Canon, Foxconn and Amkor.

• Strengths: Fully integrated supply ecosystem, fast access to Noi Bai International Airport, highly skilled technical workforce.
• Best suited for: Electronics, semiconductors, high-tech supporting industries.

�� Southern Cluster — Long An, Dong Nai & Binh Duong

Vietnam's southern industrial belt continues to benefit from newly completed infrastructure: the Ho Chi Minh City Ring Road 3, the Bien Hoa – Vung Tau Expressway and Long Thanh International Airport (scheduled to open Q2/2026). This cluster is well suited to businesses requiring fast export logistics and large-format facilities.

• Binh Duong: Expanding to 41–42 industrial zones by 2050; currently operating over 30 IZs

• Dong Nai: Direct beneficiary of KNIC Nam Long Thanh development and Long Thanh Airport

• Long An: Ring Road 3 connectivity; more competitive land costs than Ho Chi Minh City

• Ba Ria – Vung Tau: Cai Mep – Thi Vai deep-water port; air and sea logistics hub

4. FDI Trends in 2026: Quality Over Volume

The China+1 wave in 2026 has a defining characteristic that sets it apart from previous cycles: investors are no longer simply seeking low costs. They are demanding high-quality infrastructure, technically skilled workforces and ESG compliance.

• Manufacturing and processing — particularly high-tech sectors — accounts for 70.6% of total new and adjusted registered capital

• Investment in semiconductors, electronics and chip packaging is accelerating in the northern provinces

• Renewable energy and data centres are emerging as significant new FDI categories

• Chinese, Taiwanese and Hong Kong investors account for 47% of industrial leasing demand across 2024–2026

• Green building standards (LEED, WELL) are increasingly becoming mandatory requirements for multinational tenants

• The Vietnamese Government has set a target of 30% of industrial zones achieving green certification by 2030

5. Which Province Should Your Business Choose?

There is no universal answer — the right industrial location depends on your sector, supply chain configuration and operational strategy. The following provides a directional framework:

• Electronics & semiconductors: Bac Ninh, Thai Nguyen — established supply ecosystems, skilled technical labour
• Logistics & export manufacturing: Hai Phong, Ba Ria – Vung Tau — deep-water ports, international connectivity
• Cost optimisation, large-format sites: Nghe An, Long An, Dong Nai — ample land reserves, competitive pricing
• High-tech & R&D: Ho Chi Minh City, Hanoi — quality talent, innovation ecosystem
• Heavy manufacturing & energy: Nghe An, Quang Ngai — port access, low land costs

Explore industrial zones by region:

Industrial Zones — Northern Vietnam  /  Industrial Zones — Central Vietnam  /  Industrial Zones — Southern Vietnam