Over recent years, the industry sector of Lao Cai has enjoyed strong growth. By the end of 2015, the value of industrial production is expected to reach VND5,960 billion, 2.7 times the figure in 2010 (VND2,169 billion). To learn more about the efforts behind this development, Vietnam Business Forum interviewed Mr Do Truong Giang, Director of Lao Cai Industry and Trade Department. Ngo San reports.
2015 is the last year of the Five Year Plan 2010-2015, what do you think about the development Lao Cai industry has made in recent years, notable achievements as well as weaknesses?
Although Lao Cai is still facing difficulties in infrastructure, disadvantageous location far from economic centres and poor industrial products, the provincial industry has worked hard to achieve remarkable results. Especially in the 2010-2015 period, Lao Cai industry has become a key player making breakthrough in the socio-economic development of the province, elevating Lao Cai as the centre of metallurgy and chemical of the region as well as the country; the sector also did deep processing of mineral extracted in the province (copper, iron, billets, fertilizers). Many projects after going into operation has been delivering results, making considerable annual contributions to industrial production value in the area, increasing local revenues; creating jobs and stable incomes for labourers (Nhac Son Apatite Ore plant capacity of 350,000 tonnes/year; Lao Cai Cast Iron and Steel plant completed Phase 1 capacity of 500 thousand tonnes/year; DAP 2 plant capacity of 330,000 tonnes/year; 18 hydropower projects with a total capacity 456.6MW; and new investments to upgrade capacity of the yellow phosphorus factory to 63,000 tonnes/year). Power system has been set up in remote villages and ethnic minorities, where economic conditions are extremely difficult, terrain is rugged and security and political situation remain complicated.
It’s expected by the end of 2015, the value of industrial production would reach VND5,960 billion, 2.7 times the figure in 2010 (VND2,169 billion), a 14.6 percent increase compared to the target set in the Development Scheme for Industry and Industrial parks and Handicraft clusters period 2011 - 2015 to the year 2015 (VND5,200 billion); up 16.9 percent compared to the target set in the Resolution of the Provincial Party Committee XIV (VND5,100 billion); The average growth rate in the 2011-2015 period reached 22.6 percent/year. The proportion of the industry - construction accounted for 39.5 percent of the provincial GDP, up 4 percent compared to 2010. The percentage of households using national grid reached 93 percent and the percentage of villages having the grid was 92 percent.
In 2014, the Hanoi - Lao Cai highways went into operation, opening gates for economic activities, especially trade, what orientation and measures has Lao Cai decided to take in order to fully seize this opportunity?
To seize the opportunity mentioned above, industry and trade has been focusing on advising the PPC on the orientation of trade development in the area in accordance with the planning of socio-economic development in the province as well as the national planning; ensuring the implementation of the commitments of national and regional economic integration. The province is striving to level up Lao Cai into a major transshipment centre of the ASEAN - China area using the Lao Cai international border gate. Some specific targets, tasks and solutions set out for the 2016-2020 period are:
- The average growth rate: Total retail sales of goods and social services revenue to reach 14.5 percent/year (VND28,500 billion by 2020); Turnover of import-export going through the provincial border gates to be 16.3 percent/year (US$4,600 million by 2020).
- Developing the provincial market sustainably, strengthening domestic trade, promoting rapid and sustainable development of import-export, strengthening trade promotion activities and market control.
- Focusing on developing and expanding the border gate economic zone; actively investing and exploiting the Kim Thanh industrial trade zone as the nucleus of the cross border economic cooperation zones as well as maximizing the advantageous “bridge” position of Lao Cai on the economic corridor route of Kunming - Lao Cai - Hanoi - Haiphong - Quang Ninh; Increasing the revenue percentage of import-export services (temporary import for re-export, goods assessment, import-export credit, logistics).
- Strengthening international economic integration, enhancing economic - trade exchanges and cooperation with localities both national and foreign to gradually create a civilized and modern trade - service activities and attract investment and resources for socio-economic development, especially with Yunnan province, China.
What kinds of measure is the Department of Industry and Trade advising and implementing to maintain the PCI rank in 2015, as well as the next years, on a sustainable basis?
In 2013, Lao Cai’s PCI was 59.43 points, ranked No. 17/63 provinces and cities nationwide. This can be considered a “misstep” after eight consecutive years ranked in the Top 10. However, in 2014, despite all difficulties with the economic downturn, natural disasters along with intrinsic troubles of a border mountainous area, with the support and assistance of the Central along with the effort and unity of the people; as well as the determination from all levels of authorities in improving the investment and business environment. Lao Cai’s PCI rose up to 64.67 points, back to the Top 10, ranked No. 3/63 provinces and cities and got a very good ratings; confirming Lao Cai as an attractive investment destination for both domestic and foreign investors.
To help keep and improve the PCI in 2015 and also the coming years on a sustainable basis; Lao Cai industry and trade will take the initiative and actively coordinate with relevant departments and agencies to advise the People’s Committee on:
1. Implement effectively solutions of the government, the Ministry of Industry and Trade as well as the province to help enterprises remove difficulties in production and business as well as to support the market. At the same time, proposing comprehensive measures in accordance with local conditions in the spirit of complete support, simplifying administrative procedures for businesses in the field of management.
2. Issue preferential mechanisms for development investment in technical infrastructure of industrial clusters; trade infrastructure (markets, trade centres, supermarkets) in the province.
3. Accelerate administrative reform towards simplification and create the most favourable conditions for organizations, individuals and businesses; Actively improve the efficiency of the “one-stop” units at departments and agencies. Creating favourable conditions, organizing the issue of certificates of origin (C/O) for export goods at the border, helping import – export activities quicker, more convenient and time efficient for traders while still ensuring accuracy.
4. Support and create favourable conditions for the development of business support services such as Trade Promotion, Export-Import, Production Inspection; Temporary import for re-export; Entrusting; Export - import goods processing and packaging; Logistics; Customs declaration agency; Transportation; Bank; Post and Telecommunication.
5. Direct effectively trade promotion activities to strengthen the export of the province’s advantageous goods and help farmers with product consumption. Support businesses in getting involve in trade promotion activities both at home and abroad and maximizing benefits derived from those participation (Trade fairs and exhibitions; “campaign visits Vietnam priority for Vietnam”; Vietnamese goods retail market in rural areas and industrial parks).
6. Direct the market inspection force to proactively coordinate with concerned agencies to strengthen market inspection to timely detect, prevent and handle violations such as smuggling, trade fraud and unfair competition, at the same time create favourable conditions for organizations and individuals in business and production.
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