Implementing the 2-level local government model:

Economic growth is improving

According to data from the General Statistics Office, in the first 6 months of 2025, the total retail sales of goods and consumer services in Hanoi reached over 460 trillion VND. The industrial sector increased by 5.8%, while tourism recovered strongly with nearly 4 million visitors. Export and import turnover reached 10.1 billion USD and 22 billion USD, respectively, up 13.8% and 12.6% over the same period in 2024. Total budget revenue by mid-June 2025 reached 372.6 trillion VND, equivalent to 73.7% of the annual estimate; total local budget expenditure was about 59 trillion VND.

Electronic components production at Katolec Vietnam Co., Ltd. (Quang Minh Industrial Park). *Photo: Nguyen Quang*

In the first 6 months of the year, Hanoi also recorded positive signals in the investment and business start-up environment, attracting over 2.8 billion USD in FDI capital, continuing to hold the leading position in the country. Nearly 14,000 new enterprises were established with a total registered capital of over 125 trillion VND, bringing the total number of registered enterprises to date to about 403,000 enterprises.

The bright spot in the economic “picture” of the first 6 months of the year is the impressive growth rate of Gross Regional Domestic Product (GRDP). In the first quarter of 2025, GRDP reached 7.35%, 1.35 times higher than the same period last year and exceeded the growth scenario set at the beginning of the year. In the second quarter of 2025, it is estimated to reach 7.93%, bringing the 6-month growth rate to 7.59% - creating solid momentum for the whole year to reach the 8% mark...

Notably, one of the outstanding marks is the work of arranging administrative units and promoting administrative procedure reform. Hanoi has continuously improved its ranking in the provincial digital transformation index, up 19 places from 2021 to present. The city also leads the country in the industrial and information technology index, holding the second position in e-commerce for 7 consecutive years, and is the leader in e-governance and local innovation in 2024...

Director of the Hanoi Department of Industry and Trade Vo Nguyen Phong commented that in the context of the international situation continuing to develop complicatedly, with major challenges from geopolitical conflicts, trade wars and global financial instability, Hanoi city is determined to achieve growth targets, achieving many positive results in the first 6 months of 2025. The economy continues to develop positively, social security is ensured, planning and infrastructure work has made significant progress. This is an important foundation for the capital to enter the last 6 months of the year with high determination, aiming for a GRDP growth target of 8% or more in 2025.

New development opportunities for the business community

According to Vice Chairman and General Secretary of the Hanoi Association of Small and Medium Enterprises Mac Quoc Anh, in the context that Hanoi is promoting administrative procedure reform and comprehensive digital transformation application, the arrangement of administrative boundaries will create a favorable "institutional space" and "governance ecosystem", contributing to enhancing competitiveness, improving the investment and business environment, towards the goal of becoming the leading financial and innovation center in the region by 2030.

From a business perspective, Nguyen Tuan Duong, CEO of Vietnam Intestinal Health Care Joint Stock Company, shared that the merger of administrative units will create a more transparent and effective administrative environment. “We believe that the two-level local government will open up a new period of development opportunities for the business community, expanding scale, enhancing competitiveness, and accessing larger markets. In the new development phase, businesses are not only economic entities but also a force for creating value and spreading innovative thinking,” Mr. Nguyen Tuan Duong expected.

Agreeing with this view, Mr. Mac Quoc Anh commented that the arrangement of administrative boundaries is a fundamental step to synchronize the urban management model; at the same time, promote urban planning in a synchronous direction, increase regional connectivity, reduce fragmentation in infrastructure investment and public services; create conditions for localities to access public and private investment resources faster, especially in the fields of transport infrastructure, logistics, industrial parks, and high technology.

Deputy Secretary General of the Vietnam Federation of Commerce and Industry Dau Anh Tuan said that the arrangement and organization of local governments to be streamlined, efficient, effective and efficient will have a great impact on the country, creating better opportunities to compete regionally and internationally.

“A larger provincial administrative unit will create more room for economic development, investment, regional connectivity, promote even development among localities, and have adequate infrastructure for roads, seaways, and waterways. Furthermore, a two-level local government that is closer to the people will help improve the quality of service to the people and businesses,” Mr. Dau Anh Tuan explained.

It can be seen that the proactive and drastic implementation of the 2-level local government model by Hanoi city is not only a strong step in the revolution of streamlining the organizational apparatus of the political system, but also demonstrates the desire for innovation to build a modern and effective administration to better serve the people and businesses.

Source: https://hanoimoi.vn/thuc-hien-mo-hinh-chinh-quyen-dia-phuong-2-cap-dong-luc-moi-thuc-day-kinh-te-thu-do-phat-trien-707525.html