Enhancing FDI Attractiveness Through Investment Policies and Infrastructure: Evidence from Tay Ninh with Human Resource Quality as a Mediator

This study investigates the determinants of Foreign Direct Investment (FDI) attractiveness in Tay Ninh, Vietnam, focusing on the roles of investment incentives, infrastructure quality, and human resource quality as a mediator. Drawing on the endogenous growth model and the Investment Climate Framework, the research examines how strategic policies and robust infrastructure directly enhance FDI inflows, while human resource quality mediates these relationships by improving workforce productivity and innovation capacity. Using Partial Least Squares Structural Equation Modeling (PLS-SEM) with data from 437 respondents across 250 FDI enterprises in Tay Ninh, the findings confirm that investment incentives (β = 0.375) and human resource quality (β = 0.359) have the strongest direct impacts on FDI attractiveness, followed by infrastructure quality (β = 0.256). Human resource quality significantly mediates the effects of both infrastructure (β = 0.105) and incentives (β = 0.120) on FDI attractiveness. Despite Tay Ninh’s strategic location and infrastructure advancements, its limited skilled workforce (14.7% formally trained) poses challenges. The study offers policy recommendations for enhancing FDI attractiveness through extended incentives, accelerated infrastructure projects, and targeted workforce training, contributing to sustainable economic development in Tay Ninh.