Comparative Analysis of Doing Business in Hanoi, Vietnam vs Thailand

When comparing the business environments of Hanoi, Vietnam, and Thailand, both markets offer distinct advantages for investors. Hanoi combines rapid economic growth, access to Vietnam’s manufacturing and technology ecosystem, competitive operating conditions and an expanding consumer market. Thailand offers a mature industrial base, established infrastructure, extensive supply chains and a well-developed investment-promotion framework.

This article compares their economic environments, company-establishment requirements, foreign-ownership rules, government support and taxation. Because Hanoi is a municipality within Vietnam while Thailand is a country, the comparison focuses on practical considerations for investors rather than treating every economic indicator as directly equivalent.

What Is the Difference Between Doing Business in Hanoi, Vietnam and Thailand?

Hanoi offers access to Vietnam’s fast-growing economy and may permit full foreign ownership in sectors open to foreign investment, subject to market-access and licensing conditions. Thailand provides a highly developed regional business and manufacturing platform, but foreign investors must consider the Foreign Business Act and sector-specific restrictions. The preferred jurisdiction therefore depends on the proposed activity, ownership structure and investment objectives.

Business Environment of Hanoi, Vietnam vs. Thailand

Hanoi continues to present a compelling environment for businesses and investors. Official city data show that Hanoi’s GRDP grew by 8.16% in 2025. Total development investment reached approximately VND 594.7 trillion, while foreign direct investment was reported at approximately US$4.44 billion. Hanoi also recorded around 32,400 newly registered enterprises during the year. 

These figures replace the article’s older 2022 and 2023 indicators and provide a more current view of Hanoi’s economic position. The city continues to promote technology, services, manufacturing, innovation and infrastructure development as important components of its growth strategy. 

Thailand, by comparison, is a larger national economy with a mature industrial ecosystem. According to Thailand’s National Economic and Social Development Council, the Thai economy expanded by 2.4% in 2025, while total investment increased by 4.9%. Thailand’s long-established automotive, electronics, manufacturing, tourism and services industries remain important elements of its investment proposition. 

STATISTIC: Hanoi’s GRDP expanded by 8.16% in 2025, while Thailand’s nationwide GDP grew by 2.4% in 2025. These percentages are useful indicators of recent economic momentum but are not directly equivalent because Hanoi’s figure covers one municipality and Thailand’s covers an entire national economy. 

STATISTIC-SOURCE: Hanoi municipal government official information portal and Thailand National Economic and Social Development Council. 

Business Hubs in Hanoi, Vietnam

As Vietnam’s capital, Hanoi is an important administrative, financial, technology, services and manufacturing centre. Its investment ecosystem is supported by universities, research institutions, industrial and high-tech development, transport links and access to the broader northern Vietnam manufacturing corridor. 

Vietnam remains closely integrated into international manufacturing and trade networks. The country participates in major trade frameworks including ASEAN arrangements, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU-Vietnam Free Trade Agreement (EVFTA) and the Regional Comprehensive Economic Partnership (RCEP). These agreements may provide qualifying businesses with preferential market access and tariff treatment, subject to applicable rules of origin and product requirements. 

Hanoi’s role is therefore broader than that of an individual industrial hub. Businesses operating from the city can potentially combine access to government and professional services with links to industrial provinces and supply chains across northern Vietnam. Investors should nevertheless assess location-specific infrastructure, labour availability, land or lease requirements and sector licensing before selecting a site. 

Ease of Doing Business in Hanoi, Vietnam

The former World Bank and third-party ranking figures in this section have been removed because the original article did not identify a sufficiently clear current index or methodology. A more useful assessment for 2026 is to examine current registration procedures, foreign-investment conditions and administrative processing requirements. 

Hanoi introduced significant enterprise-registration reforms effective 1 July 2026. Under Resolution No. 12/2026/NQ-HĐND, specified registration procedures for private enterprises, single-member and multi-member limited liability companies, joint-stock companies and partnerships have a processing period of two working days from receipt of the required dossier. This administrative processing period should not be confused with the total time needed for a foreign-invested project, which may also involve investment registration, sector approvals, banking and other post-establishment requirements. 

Vietnam’s Investment Law No. 143/2025/QH15, effective from 1 March 2026, also changed the sequencing of foreign-investment procedures. A foreign investor may establish an economic organisation before completing procedures for issuance or adjustment of an Investment Registration Certificate (IRC), while still having to satisfy the applicable foreign-investor market-access conditions. Where an investment project is subject to the IRC requirement, the IRC must be obtained before the project is implemented. 

Thailand also offers established company-registration procedures through the Department of Business Development (DBD). However, foreign investors must separately assess whether the proposed activity is restricted under Thailand’s Foreign Business Act and whether a Foreign Business Licence, Foreign Business Certificate, BOI promotion or another exemption or approval route applies. 

Rising Urban and Consumer Demographics

Vietnam continues to benefit from a large and increasingly urban population. According to Vietnam’s National Statistics Office, the country’s average population reached approximately 102.3 million in 2025, of whom around 39.4 million—or 38.6%—lived in urban areas. The labour force aged 15 and above was approximately 53.5 million, while the proportion of workers with degrees or recognised certificates reached 29.2%. 

These current official indicators provide a more reliable basis for assessing Vietnam’s consumer and labour market than the previous unverified projection that the middle class would reach 36 million by 2030. Hanoi, as one of the country’s principal urban centres, can benefit from these broader demographic and consumption trends. 

Setting up a Company in Hanoi vs. Thailand

Incorporation

Investors establishing a business in Vietnam may consider structures such as a single-member limited liability company, a multi-member limited liability company or a joint-stock company. A foreign company may also establish a branch or representative office where the applicable commercial-presence rules allow. A branch or representative office should not, however, be treated as equivalent to an incorporated Vietnamese company. 

The previous description of Vietnam’s incorporation process as a fixed sequence of obtaining an IRC followed by an Enterprise Registration Certificate (ERC) is no longer universally accurate. Under the Investment Law effective from 1 March 2026, foreign investors may establish an economic organisation before the IRC procedure, although projects falling within the statutory IRC requirement must obtain the certificate before implementation. The competent IRC authority depends partly on the project location, including whether it is within an industrial, export-processing, high-tech, digital-technology or economic zone. 

After establishment, businesses may need to complete tax, banking, electronic-invoice, employment and social-insurance procedures according to their circumstances. Vietnam’s current electronic-invoice framework is governed by Decree No. 254/2026/NĐ-CP, effective 1 July 2026. The previous reference to ordering a company seal and registering it with the local police has been removed because it does not reflect the current general enterprise-registration process. 

The previous requirement to pay an annual “business licence tax” or business licence fee has also been removed. Vietnam abolished the business licence fee from 1 January 2026 under the current regime. 

In Thailand, formation of a private limited company generally involves promoters preparing and registering a Memorandum of Association, subscription for the shares, a statutory meeting, appointment of directors and registration of the company. At least two promoters are required, and each promoter must subscribe for at least one share. Where the statutory requirements are ready, the Memorandum of Association and company registration may be submitted together. 

The former statement that Thai company registration must be completed within three months is incorrect. Current DBD guidance states that if company registration is not completed within three years after registration of the Memorandum of Association, the memorandum ceases to be effective. Tax registration, VAT obligations and foreign-business permissions should be assessed separately rather than treated as universal prerequisites to opening a corporate bank account. 

Directors and Shareholders

In Vietnam, a single-member limited liability company has one owner, while a multi-member limited liability company may have between two and 50 members. A joint-stock company requires at least three shareholders. Vietnam also requires an enterprise to ensure that at least one legal representative resides in Vietnam. Accordingly, the original statement that Vietnam has no residence requirement for directors or company representatives was overly broad. 

In Thailand, a private limited company requires at least two promoters at formation, and the promoters become initial shareholders by subscribing for shares. Directors are appointed through the company’s formation and governance process. Foreign ownership must then be assessed according to the Foreign Business Act, other sector legislation and any applicable investment-promotion framework. 

Beneficial Ownership Disclosure in Vietnam

Companies operating in Vietnam must now consider beneficial-ownership reporting as part of their corporate compliance obligations. From 1 July 2025, newly established companies are required to declare beneficial-owner information to the business registration authority. Companies established before that date generally provide the information when making their next prescribed enterprise-registration change, although voluntary supplementation is possible. The rules focus on identifying individuals who ultimately own or exercise control over the enterprise. 

Government Support in Hanoi, Vietnam vs. Thailand 

Hanoi continues to attract significant investment. Official 2025 data reported approximately US$4.44 billion in FDI, around 32,400 newly registered enterprises and total development investment of approximately VND 594.7 trillion. These figures replace the article’s older 2023 indicators and demonstrate the continued scale of business and investment activity in the capital. 

Administrative reform is another aspect of Hanoi’s investor-support environment. The city’s 2026 enterprise-registration reforms shortened specified registration-processing times to two working days and reduced certain filing requirements. Investors should nevertheless distinguish enterprise registration from investment approvals and regulated-sector licences, which can require separate procedures. 

Thailand supports investment primarily through frameworks including the Board of Investment (BOI). Depending on the promoted activity and applicable category, BOI privileges may include corporate-income-tax incentives, import-duty incentives and non-tax privileges relating to matters such as skilled foreign personnel and land use or ownership for promoted operations, subject to the conditions of the promotion. 

STATISTIC: Thailand’s BOI reported that investment-promotion applications in 2025 reached approximately THB 1.877 trillion across 3,370 projects, with application value increasing 67% from the prior year. Major areas included digital, electronics and electrical appliances, and automotive-related investment. 

STATISTIC-SOURCE: Thailand Board of Investment. 

Taxation in Hanoi, Vietnam vs. Thailand 

Vietnam’s standard Corporate Income Tax (CIT) rate is 20%. Under the current Corporate Income Tax Law, qualifying enterprises with annual revenue not exceeding VND 3 billion may be subject to a 15% rate, while qualifying enterprises with annual revenue above VND 3 billion and not exceeding VND 50 billion may be subject to a 17% rate, subject to statutory conditions and implementing rules. Investment incentives may also apply to qualifying projects, sectors or locations. 

Vietnam’s VAT system continues to provide statutory rates including 0%, 5% and 10%, depending on the transaction. However, the Government has extended the two-percentage-point VAT reduction so that many supplies ordinarily subject to 10% VAT are taxed at 8% from 1 July 2025 through 31 December 2026. Certain sectors and categories are excluded from the reduction. 

Vietnam’s revised Personal Income Tax framework applies a five-band progressive schedule ranging from 5% to 35% for relevant resident employment income for the 2026 tax year. Current personal and dependent deductions and the treatment of non-resident income should be reviewed according to the taxpayer’s specific circumstances. Foreign Contractor Tax also remains relevant to certain payments to foreign organisations or individuals carrying on business or earning income in Vietnam, with the applicable tax components and rates depending on the transaction. 

In Thailand, the standard corporate income tax rate is generally 20% of net taxable profit. VAT is currently collected at 7%, and businesses whose annual turnover from taxable sales or services exceeds THB 1.8 million generally fall within the VAT registration requirement, subject to statutory exemptions and specific rules. 

Thai companies generally have both annual and half-year corporate income tax obligations. The half-year return is generally filed within two months after the end of the first six months of the accounting period, while the annual return is generally due within 150 days after the end of the accounting period. Qualifying tax losses may generally be carried forward for up to five accounting periods. Withholding-tax treatment varies according to the payment type, recipient and any applicable tax treaty, so a single 1%–15% range should not be treated as universally applicable. 

A Snapshot Comparison: Hanoi, Vietnam vs. Thailand 

Aspect	Hanoi (Vietnam)	Thailand
Political Stability	Stable, focused on reforms, ranked 98 (World Bank)	Less stable, ranked 127 (World Bank)
Economic Growth	6-7% GDP growth, manufacturing-driven in Hanoi, ranked 41 (World Bank)	Competitive, diverse markets, ranked 119 (World Bank)
Industries	Manufacturing, electronics, IT, and finance	Automotive, electronics, tourism, and agriculture
Top Export Destinations	U.S., China, Japan, South Korea, and EU	U.S., China, Japan, EU, and ASEAN countries
Labor Force	Young, skilled, ranked 13 (World Bank)	Mix of skilled, semi-skilled workers, ranked 16 (World Bank)
Labor Cost	Competitive, lower than developed countries	Higher minimum wage than Vietnam
Foreign Ownership	Up to 100%, some restrictions in certain sectors	Generally capped at 49%, licenses and exemptions required
Company Registration	Up to 1 and a half months for setup	1 to 2 weeks for setup, 6+ months for foreign business licenses
Types of Companies	LLCs (single and multi-member), JSCs	Private Ltd., Public Ltd., Partnership
Corporate Tax	20%, with incentives for certain sector and regions	20%, lower rates for SMEs, various incentives
Global Trade Cooperation	Member of ASEAN, EVFTA, CPTPP, and WTO	14 FTAs, close to ASEAN, Australia, China, and South Korea
Foreign Investment Incentives	Tax holidays, reduced rates, especially in industrial zones	Tax exemptions, land ownership, investment privileges
Infrastructure	Developing roads, industrial zones, and urban areas	Well-developed highways, airports, ports
Connectivity	Noi Bai Airport connects to major Asian cities	Bangkok is a regional hub, with Suvarnabhumi and Don Mueang airports

COMPARISON: 

Aspect	Hanoi / Vietnam	Thailand
Recent economic growth	Hanoi GRDP grew 8.16% in 2025	Thailand national GDP grew 2.4% in 2025
Economic focus	Services, technology, manufacturing, digital economy and northern Vietnam supply chains	Automotive, electronics, digital investment, manufacturing, tourism and services
Foreign ownership	100% foreign ownership can be available in sectors open to foreign investors, subject to market-access and sector-specific conditions	No universal 49% cap; treatment depends on the Foreign Business Act, activity restrictions, sector laws and available licence, certificate or BOI routes
Enterprise registration	Specified Hanoi enterprise registrations have a two-working-day processing target from receipt of the prescribed dossier from 1 July 2026; foreign-investment procedures may be additional	Private limited company formation generally involves at least two promoters, an MoA and company registration; restricted foreign activities may require separate permission
Common company forms	Single-member LLC, multi-member LLC and JSC; branches and representative offices may also be available in applicable circumstances	Private limited company, public limited company, partnerships and other permitted forms
Minimum ownership	Single-member LLC: one owner; multi-member LLC: 2–50 members; JSC: at least three shareholders	Private limited company formation requires at least two promoters/shareholders
Corporate income tax	Standard 20%; qualifying lower-revenue enterprises may benefit from 15% or 17% rates, with other incentives potentially available	Standard 20%, subject to applicable concessions and investment incentives
VAT	Statutory rates include 0%, 5% and 10%; many qualifying 10% supplies are temporarily reduced to 8% through 31 December 2026	Current rate 7%; VAT registration generally applies when taxable annual turnover exceeds THB 1.8 million
Foreign-investment incentives	Incentives may apply according to investment sector, project and location	BOI promotion can provide tax and non-tax incentives for qualifying promoted activities
Trade cooperation	ASEAN, RCEP, CPTPP, EVFTA and other trade agreements	ASEAN and RCEP participation; Thailand currently has 14 FTAs in force covering 18 countries
Beneficial ownership	Beneficial-owner disclosure requirements apply under Vietnam’s enterprise-registration regime	Corporate and foreign-business compliance requirements depend on the applicable Thai legal framework
Foreign-investment compliance	Market-access conditions, IRC requirements and sector approvals must be considered	Foreign Business Act Lists 1–3 and sector-specific laws must be reviewed

The economic figures in this comparison should be interpreted with care because Hanoi’s GRDP represents one municipality while Thailand’s GDP represents the entire country. 

Vietnam’s foreign-investment and registration entries reflect the Investment Law effective from March 2026 and Hanoi’s enterprise-registration reforms effective from July 2026. Thailand’s entries reflect current DBD and BOI guidance and the Foreign Business Act framework. 

The tax entries reflect current Vietnam and Thailand tax-authority or legislative information, while the trade-agreement entries reflect official Vietnamese and Thai trade sources. Thailand’s Department of Trade Negotiations reports 14 FTAs currently in force with 18 countries. 

Premia TNC’s Industry-Leading Incorporation Services

At Premia TNC, we support businesses establishing and operating in Vietnam through incorporation and compliance services tailored to the proposed investment structure. This may include assistance with enterprise and investment registration documentation, coordination of lease-related documentation, bank-account establishment and other post-incorporation procedures. Where an IRC is required, the appropriate filing authority and procedure should be determined according to the investment project and its location under the current investment regime. 

UPDATED: Our compliance, accounting, taxation and payroll services can also support businesses in meeting applicable Vietnamese filing and employment obligations. With recent developments such as beneficial-ownership reporting, the 2026 electronic-invoice regime and changes to tax rules, businesses should review their compliance procedures periodically rather than relying on historic incorporation checklists. 

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