Bo Y International Border Gate Economic Zone holds a very important position in the development connectivity strategy between ASEAN nations and the Greater Mekong Subregion (GMS). Mr Nguyen Trong Hao, Director of Kon Tum Economic Zone Authority, gives an exclusive interview to Vietnam Business Forum on this economic zone’s contributions and development orientations. Hoang Lam reports.
Could you please elaborate on the contributions of the Bo Y International Border Gate Economic Zone to the development of Kon Tum province in particular and Vietnam in general?
Bo Y International Border Gate Economic Zone, covering 70,438 ha, is the driving economic zone and centre of the development triangle of Vietnam, Laos and Cambodia and plays an important role in socioeconomic development in the Central Highlands and the central region. The construction investment and development of Bo Y International Border Gate Economic Zone have importantly contributed to the development of Kon Tum province in particular and the country in general in recent years.
Specifically for Kon Tum province, Bo Y International Border Gate Economic Zone is one of the three driving economic areas in the province. The development of the economic zone has important contributions to the economic growth and restructuring of Ngoc Hoi district in particular and Kon Tum province in general, thus accelerating the process of labour attraction and mobility in the region. Besides, the economic zone is the gateway for Kon Tum province to expand investment, trade, cultural and social cooperation with southern provinces of southern Laos, northeastern Thailand and Ratanakiri province of Cambodia, and is an important factor to open up many opportunities for the province to draw domestic and foreign investment capital.
For Vietnam, the investment in the Bo Y International Border Gate Economic Zone is an important basis for ASEAN nations to work out a unified road corridor through the economic zone that connects to seaports in central Vietnam. In addition, Bo Y has been chosen to be one of eight border gate economic zones to be funded by the State Budget for development in the 2012-2015 period to become a driving force and the centre of development triangle of Vietnam, Laos and Cambodia. Besides, the border gate of Bo Y (Kon Tum) - Phu Cua (Laos) is one of three border gates to be expanded in the coming time in accordance with an agreement signed by the Governments of Vietnam and Laos (Resolution 06/NQ-CP of Government dated March 7, 2012).
What incentives will investors enjoy when they invest in the Bo Y Border International Gate Economic Zone?
Basically, investment incentive policies like tax, land-use fee, charges, customs and financial duties are attractive and encouraging enough for businesses to make investment into industrial parks and economic zones in Kon Tum province. Apart from centrally stipulated policies, Kon Tum province does not have any separate mechanisms and policies for Bo Y International Border Gate Economic Zone.
In return, the Management Board for Bo Y International Border Gate Economic Zone actively supports investors to explore investment opportunities and carry out their projects. So, when investors register, the board’s staff will work with them to settle procedures in the most comfortable and rapid way thanks to the one-stop source mechanism as provided in Decision 429/QD-CT dated October 17, 2011 of the Provincial People’s Committee Chairman.
Boosted by strong investment from central and local budgets, in what fields and investment methods is the Bo Y International Border Gate Economic Zone calling for domestic and foreign investors?
There are three fields investors can adopt various investment patterns like entire funding and BOT (build - operate - transfer), including investment for construction of infrastructure for urban zones, industrial zones and international trade zones; investment for construction of production facilities, export agricultural product processing, and apparel production; and investment for construction of commercial and tourism works like trade centres, restaurants, hotels, finance and banking facilities.
To date, the economic zone is housing 52 investment projects with a total registered capital of VND970 billion, of which 38 projects registered to locate their production facilities and 14 projects registered to build working offices. Among 38 production and business projects, 24 projects have been put into operation with a combined registered capital of VND567 billion (VND543 billion disbursed) and 14 projects are under construction with a total registered capital of VND403 billion (VND28.4 billion disbursed).
The construction of Bo Y International Border Gate Economic Zone into a powerful economic centre is a major goal of Kon Tum province. Would you be kind enough to tell us about the development policies and orientations to realise this objective? Do you have any suggestions to the central government to run the economic zone effectively?
In 2009, the government approved a scheme for the development of Bo Y border gate area, specified in Decision 06/QD-TTg dated January 5, 1999. The decision determined that Ngoc Hoi district, together with its Bo Y International Border Gate Economic Zone, is one of three driving economic zones of the province (Resolution 02-NQ/TU dated April 20, 2007 of the 13th Provincial Party Congress, which detailed the investment for construction and development of Kon Tum province’s dynamic economic zones in 2007-2010, taking into account the vision to 2020).
The Resolution of the 14th Provincial Party Congress also reconfirmed the fundamental solutions for Bo Y International Border Gate Economic Zone, stuck with Plei Kan Town, saying that "Reviewing and suggesting the Government to revise the development planning for the Bo Y International Border Gate Economic Zone; taking advantage of maximum resources to build the infrastructure system of the economic zone; speeding up investment attraction for planned industrial parks; building the new administrative centre for Ngoc Hoi district on schedule.” Besides, the province has many medium and long-term investment development plans and programmes for Bo Y International Border Gate Economic Zone.
To operate the Bo Y International Border Gate Economic Zone more effectively, I hope the central government will empower the economic zone to operate as a special economic - commercial zone as the Lao Bao Economic - Commercial Zone in Quang Tri province (Decision 11/2005/QĐ-TTg dated January 12, 2005 of the Prime Minister). The Governments of Vietnam and Cambodia agreed to upgrade the secondary border gate of Dak Coi (Kon Tum province, Vietnam) and Kon Tunias (Rattanak Kiri province, Cambodia) into a national border gate in order to develop the Bo Y International Border Gate Economic Zone into a driving economic centre and the centre of development triangle of Vietnam, Laos and Cambodia to boost economic and commercial exchange development with Cambodia.
Currently, the Bo Y International Border Gate Economic Zone is defined by the Prime Minister as one of landlocked border state economic zones to be centrally invested and prioritised. Therefore, the Government necessarily has mechanisms and incentives and increases resources for infrastructure investment here. Particularly, the centrally funded investment capital should be raised from current VND40 billion to VND200 billion a year from 2014. The centrally financed support for infrastructure development projects also needs to be increased from 60 per cent as stipulated in the Prime Minister’s Decision 60/2010/QD-TTg dated September 30, 2010 to 90 per cent because Kon Tum is rated a province of extreme social and economic difficulties. All money collected from the economic zone to the State Budget should be channelled into infrastructure development in order to step up infrastructure construction, because the amount is only some VND100 billion a year now.
More Japan-funded ODA capital needs to be invested into technical and social infrastructure construction in the economic zone so as to draw more foreign projects into the economic zone while increasing Vietnam’s ODA source for Laos and Cambodia in order to promote socioeconomic development and create development similarity of the three countries in the development triangle.
Besides, the province hopes the central government will revise the Prime Minister’s Decision 33/2009/QD-TTg dated on March 2, 2009 on financial mechanisms and policies on border gate economic zones. The government should also increase investment incentives like taxes and land rentals and the incentive duration in order to help enterprises get through the current tough time. Decree 29/2008/ND-CP of the Government needs to be supplemented and amended to create a full legal framework for construction and management of industrial parks, economic zones and export processing zones. Functions, obligations and authority of the Management Board need to be clearly defined and changed from authorisation to direct administration to perform its managerial roles more effectively.
Vietnamese
