Industrial Zones Catch TPP-induced Investment Wave

Tien Giang was approved in principle by the Prime Minister to establish seven large-scale industrial zones, of which four have currently gone into operation, namely My Tho, Tan Huong, Long Giang and Soai Rap, and three others are in the process of completing procedures for construction. Besides, the province has four small-scale industrial zones, namely Trung An, Tan My Chanh, Thanh An and Song Thuan, with a total area of 108.9 ha and a combined registered investment capital of VND141.82 billion.

 

Mr. Cao Minh Tam, Director of the Tien Giang Management Board of Industrial Zones, said the advantages of Tien Giang province-based industrial zones lie in convenient access to ground and waterway transport networks, particularly inner transport systems, power grids, and water supply and sewage systems in industrial zones. Support services for production and business activities of tenants are quite sufficient, including banking, port and customs inside industrial zones, thus facilitating import and export of goods performed by tenants. Investors can recruit enough personnel from Tien Giang province’s a young labour force. Notably, industrial zone tenants are granted corporate income tax preferences. Indeed, investment incentive policies for investment projects in industrial zones are very attractive to investors. The Provincial People’s Committee issued Decision 45/2001/QD-UB dated October 16, 2001 on investment incentives for projects in My Tho Industrial Park.

 

To date, industrial zones in Tien Giang province have achieved encouraging results in investment attraction. They housed 76 investment projects, including 50 foreign direct investment (FDI) projects, with a total investment of US$1,364.87 million and VND3,983.56 billion by the end of 2015. The occupancy rate of four operational industrial zones was 50.18 per cent. Particularly, small-scale industrial complexes attracted 86 projects, including seven FDI projects, with a total registered investment capital of VND3,120.87 billion. The occupancy rate in four ICs in operation was 95.44 per cent.

 

In 2015, the industrial production value generated by tenants in industrial zones reached VND36,157.79 billion, up 20.53 per cent year on year and 3.31 per cent higher than the full-year plan. Gross revenue of FDI companies totalled US$1,408.47 million, up 53.8 per cent year on year and 0.6 per cent higher than the yearly target. Revenue of domestic investment companies reached VND11,113.22 billion, up 76.09 per cent from a year earlier and 11.13 per cent higher the full-year target. Their exports valued US$1,131.27 million, up 10.74 per cent from a year earlier and 2.84 per cent above the yearly plan. Tenants currently employ more than 85,000 local workers. The formation and development of industrial zones has importantly contributed to the increase of added value of industrial production (accounting for over 65 per cent of the province’s industrial production value), economic restructuring and export expansion (making up more than 60 per cent of the province’s export value).

 

To improve investment performance, especially in FDI attraction, the Tien Giang Management Board of Industrial Zones has advised the Tien Giang Provincial People’s Committee to issue regulations on the management of industrial zones, regulations on environmental management and regulations on settlement of investment procedures in industrial zones according to one-stop single-window mechanism. At the same time, the board is always ready to serve and support investors in industrial zones. In addition to support policies on investment procedures, investors also enjoy preferential policies on tax and financial supports for worker training and other financial supports from Tien Giang Trade Promotion Fund when they attend trade fairs and exhibitions.

 

The Tien Giang Management Board of Industrial Zones has actively supported businesses to deal with their problems and placed first priority on administrative procedure reform toward a one-stop single-window mechanism. The board has applied ISO9001:2008 standards to administrative procedures, clarified processes and posted procedures and processes at units at the service of investors and the board’s website. All issues concerning investment and business procedures arising in industrial zones are handled at the Tien Giang Management Board of Industrial Zones. This is one of strong points that draw more investors into industrial zones and build up the trust of investors when they do business in the province.

 

To catch the new wave of investment generated by new free trade agreements, particularly Trans-Pacific Partnership (TPP), from 2016 to 2020, industrial zones in Tien Giang province will focus on attracting such sectors as electricity; mechanical assembly; woodworking; household goods; dermatological products; pharmaceutical, cosmetics and medical equipment; agro-forestry product processing; paper; new materials; and high-tech supporting industries. The province will focus on developing competitive industrial products, supporting industries, high-tech industries, agricultural industries and rural economies.

 

To improve the quality of investment flows, the Tien Giang Management Board of Industrial Zones pays special attention to selecting investors. Accordingly, the board will pick investors having enough financial capacity, using advanced equipment and technologies, using less labour and using environmentally friendly technologies. The authority will also seek and invite financially viable, credible and experienced investors to invest, build and operate infrastructure in industrial zones to serve production and business demands of tenants.